Both sides confirmed the deal had been reached for the groups to drop a legal complaint against Google but refused to comment on its specifics.
The conflict stemmed from Google's autocomplete feature that suggests what search people might want based on algorithms of previous searches.
Because users of Google.fr frequently ask whether politicians, actors or other celebrities are Jewish or not, the word "Jew" in French is frequently suggested as a possible result.
Six groups, including SOS Racisme, the Movement against Racism and for Friendship between Peoples (MRAP), the International League Against Racism and anti-Semitism (LICRA) and Memoire 2000 argued that Google was unintentionally breaking the law.
Google users "are confronted daily by the unsolicited and almost systematic association of the word 'Jew' with the names of the best-known people in the world of politics, the media or business," the groups said.
Under French law, it is illegal to record someone's ethnicity in a database.
Searches conducted on Google.fr, including for example for President Francois Hollande, continued to offer the word "Jew" as a top suggestion on Wednesday.
Bernard Jouanneau, a lawyer for Memoire 2000, said the deal "identified areas of useful cooperation in the fight against racism and anti-Semitism that put an end to the dispute."
Google also refused to comment on the specifics of the deal, but said it would be working with the anti-racism groups on public education projects.
"Google supports education and information against racism and anti-Semitism," a Google France spokesman said.
"Together with the associations, we will develop and promote projects aimed at increasing the awareness of Internet users to values of tolerance and respect."