Katherine has been raising Michael's sons, Prince Michael, 15, and Blanket, 10, and 14-year-old daughter Paris in California since the pop icon died in 2009.
A judge last week awarded temporary guardianship of the children to T.J. Jackson, the adult son of their uncle Tito, after Katherine, 82, went on vacation to an Arizona resort for more than a week without her young grandchildren and didn't stay in touch.
Relatives offered conflicting accounts regarding her health and whether she was accessible to Michael's children. Also unclear was whether Katherine was pushed into going to Arizona by some members of her family who allegedly want her to get rid of the executors of Michael's estate.
The Los Angeles Times reported Judge Mitchell Beckloff restored Katherine as the children's guardian Thursday, but said T.J. will eventually share full custody of Michael's kids with his grandmother.
"It's clear to me that the children are well cared for by Mrs. Jackson. It is clear to me they love her very much," the Times reported Beckloff said at a hearing.