People in Waldorf, in the south-west, were ordered in May to keep their cats indoors to protect an endangered bird.
Cats were only allowed to venture outside if they were kept on a leash no more than two metres (6ft) in length.
But the animals were again allowed to roam free from 00:01 local time on Monday.
If a cat escaped while the lockdown was in force, owners were told to call a special hotline, then find and detain the offending feline.
Any breach would result in a fine. An owner whose animal injured or killed one of the protected birds had to pay up to €50,000 (£42,000).
Authorities had been attempting to protect the local population of the crested lark, saying the species was endangered in the state of Baden-Württemberg, and wider Germany.
They said there were just three breeding pairs left in Walldorf itself.
Activists criticised the restrictions, saying they would harm the cats' welfare, while also stressing they supported efforts to protect the larks.