Controversial parking charges introduced by Telford and Wrekin Borough Council have been dropped over the Christmas period.
Pay and display machines were installed in Newport and Wellington on 18 October, sparking protests from businesses worried about loss of trade.
The council decided to suspend charges with immediate effect at a meeting on Tuesday evening.
Lower rates of 20p an hour and £1 all day will come into force on 6 January.
The borough's parking policy will be examined in a review which is estimated to last about six months.