A declaration of a state of emergency in the province remains in force, the Manila Bulletin reported. Military commanders say 4,000 soldiers are still in the province.
Eduardo Ermita, the president's secretary, told reporters 529 people were arrested during the week the province was under martial law. He said the military and police had also successfully cleared rebel groups out of the area.
The massacre was allegedly orchestrated by members of the powerful Ampatuan clan. The government says the Ampatuans then tried to avoid arrest by fomenting a rebellion.
Ronaldo Puno, the interior and local government secretary, said Arroyo's decision to lift martial law after such a short period shows there was no "grand conspiracy" to put much of the country under military rule.
"We'll waste no time in going back to the normal constitutional processes that we have," he said.
Justin Bieber crashes Drake Bell's album release party
Rosie O'Donnell unveils nearly 50-pound weight loss