Protesters in the Argentine town of Gualeguaychu have decided to lift a long-running blockade of border crossings with Uruguay.
Uruguayan builders are already working on one of the plants
The blockade began early last month in protest at the planned construction of two pulp mills on the Uruguayan side of a river shared by the two countries.
Local Argentines fear the paper mills will pose an environmental hazard - a claim Uruguayans deny.
The blockade ended after both countries called for the project to be halted.
Argentine President Nestor Kirchner and Uruguayan President Tabare Vazquez agreed to put on hold the construction of the mills on the bank of the River Uruguay until an independent environment study is completed.
A Finnish and a Spanish company want to invest $1.7bn (£953m) in the two factories.
Thousands of Uruguayans have expressed support for the project, which they say is safe, legal, and would bring much-needed foreign investment and jobs to the country.
But the residents on the Argentine side, backed by international environmental organisations including Greenpeace, say the pulp mills will pollute the river and deter tourism.
The conflict has strained relations between the two normally friendly countries.
Argentina even threatened to take Uruguay to the International Court of Justice in The Hague claiming its neighbour has broken international treaties over the management of the river - something the government of Montevideo has denied.