The residents of Valka and Valga, who have to cross the Latvian-Estonian border every day, will be able to move freely between the countries from Thursday.
Unrestricted movement is valid only in Valga and Valka administrative districts.
The Latvian government made the decision on Tuesday, broadcaster LSM reported.
Latvia's Covid-19 infection rate has fallen below 320 cases per 100,000 inhabitants. Estonia's 14-day infection rate is 163.8.
Editor: Helen Wright