Proview Technologies had claimed ownership over the rights to the iPad name in the Chinese market after registering it in 2000.
However, Apple argued that it had bought the worldwide rights to the name in 2009.
A court in Guangdong asked the companies to try and reach a resolution to the dispute, which extended to legal action in Apple's backyard of California.
In a statement, the Guangdong High People's Court said: "The iPad dispute resolution is ended.
"Apple Inc. has transferred $60m to the account of the Guangdong High Court as requested in the mediation letter."
Shenzen-based Proview Technology registered the IPAD name in various countries before Apple launched its hugely popular tablet computer.
The company, a subsidiary of LCD screen maker Proview International Holdings (PVIHF), made an unsuccessful attempt to launch a tablet product in 2000.
Apple thought it had gained control over the iPad name after it agreed a deal with Proview's Taiwanese affiliate, Proview Taipei, in 2006 to transfer the IPAD trademark for £35,000.
But in December 2011, a court in the southern China city of Shenzen ruled that Proview was not bound by the agreement as it was not involved in those negotiations, meaning Apple did not hold the iPad trademark in China.
Following the ruling, Proview began contacting officials across China with a view to blocking sales of the iPad.
But after the court ruling on Monday (July 2), a Proview spokesman confirmed to the BBC that the dispute has now been resolved.
"The case is settled, both sides are satisfied with the agreement," said Ma Dongxiao, a lawyer representing Proview.
China is a key market for Apple due to its ever growing demand for gadgets, and so it was essential for the company to act against potential disruption of sales of its iPad tablet computer.
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