The decision by Glenbryn residents to abandon their protest outside Holy Cross school in Ardoyne was welcomed by the Taoiseach.
Mr Ahern said it was essential that normality and stability returned to north Belfast for the sake of its children. "I warmly welcome the resolution of this long-running dispute. I must congratulate those in the Northern Executive and in the local community in achieving this result.
"I hope it is now possible to bring back normality and stability to the people of the Ardoyne area especially the children - and I must emphasise that."
A spokeswoman for the First Minister and Deputy First Minister said they were encouraged by the breakthrough. She said the Executive would meet on Monday to examine ways of defusing sectarian tensions in Ardoyne.
"We look forward to the Holy Cross children being able to go to school unhindered from Monday. The decision will create a climate that will enable us to help address the wider socio-economic problems facing North Belfast,"
Father Aidan Troy, chairman of the school's board of governors, said he was absolutely delighted but warned that rebuilding community relationships in Ardoyne remained "a huge challenge".
"This is such good news. When the children wake up this morning, it will finally be all over for them. But a huge task is now facing us. We must work to restore trust, co-operation and understanding between the two communities here."
A dangerous absence of political structures had allowed the conflict to fester, Father Troy said.
"There is a real lack of political dialogue in north Belfast. There is a vacuum. We at local level could only carry things so far. Stronger voices were needed. There is a huge job within the two communities to try and reach the same way forward, otherwise it will not work. If we do not get engaged in some sort of basis to try to work out common grounds, it will only slip back into something awful."
Local SDLP Assembly member Mr Alban McGuinness said it was "terrific news".
"There will be great relief for everyone in Ardoyne but especially for the parents and children who have suffered so much over the past two months," he said.
The intervention of the First and Deputy First Minister had proved vital, he said. It was essential that the Executive now moved to create cross-community structures through which the two sides could resolve their differences.
Local Sinn FΘin Assembly member Mr Gerry Kelly praised the "courage of the children and their parents". He said: "It is now incumbent upon all of us to ensure that there is never a repeat of the scenes witnessed daily on the Ardoyne since early September."
Earlier, Catholic parents held a protest against the dispute outside the offices of Belfast City Council. About 200 demonstrators, many carrying placards and banners, blocked roads outside the City Hall. The Right to Education Group released a red balloon for each of the school children caught up in the dispute and brought traffic in the city centre to a halt.