Amid a debate over academic freedom and a back and forth over whether to pursue the project, Bavaria indicated that it would not try to stop a historical institute from bringing out a version of the book with scholars' commentary.
But the southern state stressed in a statement that it would seek to prevent any other full or partial publication of the 1924 book in which Hitler railed against the "Jewish peril".
Bavaria holds the rights to "Mein Kampf" (My Struggle) because Hitler was officially a resident of Munich when he died, but those rights expire at the end of 2015.
Since World War II, the state has blocked any reprints of the book but two years ago announced plans to publish in early 2016 an annotated version for academic purposes and to help "demystify" the text.
However that seemed in doubt after the Bavarian state government changed course in a surprise move in December, insisting that the "seditious" book must stay off the market after complaints from Holocaust survivors.
Germany's Central Council of Jews has welcomed the prospect of an annotated "Mein Kampf".
Several Bavarian legislators complained over the decision to torpedo the academic edition, a project the state parliament had supported, and which had already cost €500,000 in state funding.
But Bavaria said in its statement Wednesday that the institute's academic freedom would remain "untouched" and it could bring the annotated version out in its own right.
"The freedom of science to confront the topics which, in its view, are necessary is thereby not restricted," Bavarian state minister for education Ludwig Spaenle said in the statement.
Hitler started writing "Mein Kampf" in prison after his failed putsch of 1923. After his rise to power, millions of copies were published. From 1936, the Nazi state gave a copy to all newlyweds as a wedding gift.