Al Barron's lawyer, C.J. Horkey, said his client plans to retire from the Monroe Public Schools after 36 years as a teacher.
"He looks forward to spending the final three weeks of his career doing what he loves: teaching the young people of Monroe," Horkey said in a statement.
Barron was suspended for around two weeks, receiving support from his students and former students and their families. The story went national last week.
School Superintendent Barry Martin announced Barron's reinstatement Sunday night.
"As a result of incorrect information, a highly respected and loved teacher, and one who has done much for his students and the community, has had to endure a public airing of what should have ended through a district discussion," Martin said in a statement.
Horkey said that during the lesson that resulted in his suspension Barron discussed minstrel shows and then showed his students a 29-second clip of white performers wearing blackface makeup. He said the school's assistant principal was in the classroom for about 20 minutes of the lesson.
"It was a lesson on stereotypes," Horkey said.
Monroe, a city of about 20,000, is in southern Michigan near the border with Ohio. Almost 90 percent of the population is white, with black residents making up just over 6 percent.