Lawmakers voted to restore land delineation decisions to the National Indigenous Affairs agency Funai, which will also be placed under the Ministry of Justice again.
The reversal must still be voted on in the Senate.
The far-right president had alarmed anthropologists and environmentalists by planning to assimilate Brazil’s 800,000 Indigenous people into Brazilian society and open reservation lands to commercial agriculture and mining, even in the Amazon rainforest.
Bolsonaro’s first decree reorganizing the executive branch the day he took office in January put Funai under a newly created Women, Family and Human Rights Ministry headed by an evangelical pastor who wants to Christianize Indigenous people.
Brazil’s main Indigenous organization APIB called Wednesday’s vote a historic victory against the government’s plan to open up Indigenous lands to agribusiness.
Indigenous leaders protested that without their ancestral lands, Indigenous languages, cultures and ways of life would die.
“Our relation with the land is about sustainability and respect for Mother Nature,” APIB said in a statement.
Environmentalists have defended the reservations as the best way to stop deforestation of the Amazon rainforest, considered by many as nature’s best defense against global warming, with its trees absorbing huge amounts of carbon dioxide.