A crowd of about 1,000 cheered when Julie Combs, a member of the community advisory board, announced that City Manager Kathy Millison said she ordered Santa Rosa police to stand down and allow camping until Tuesday.
The community advisory board serves as a bridge between the community and public safety agencies.
Word of Millison's order reached Combs by email at 1:45 p.m., and Combs made the announcement to the crowd at about 2 p.m.
The City Council will revisit the issue of continued camping on Tuesday.
The camping at the complex on Santa Rosa Avenue and First Street will be allowed if there is no violence, alcohol, drugs or public urination.
Earlier this week, some members of "Occupy Santa Rosa" said they were willing to be arrested and intended to set up camp at the City Hall complex.
Santa Rosa Police Chief Tom Schwedhelm said police officers would present the campers with options and that the police response would depend on the campers' reactions to those options.
The crowd began to march on downtown streets at about 2:30 p.m., chanting, "Whose streets? Our streets!"