The settlement, reached in recent days by state prosecutors, the justice Department and Microsoft, averted the prospect of litigation over a complaint by frustrate computer users who want to use software other than Microsoft's to search through films on their hard drives.
Google had made its complaint confidentially as part of consent decree proceedings set up to monitor Microsoft for any anticompetitive conduct after it settled a landmark antitrust lawsuit five years ago that had been brought by the states and the Clinton administration.
The federal government and the states were planning to file a joint status report by midnight on Tuesday in the consent decree proceedings that outlined the changes Microsoft would be making to Vista.
State and federal lawyers were exchanging drafts of the report Tuesday evening.
They said they had reached agreement on a remedy, although there was still some disagreement over the report's language.
The disagreement reflected tensions between the Justice department, which initially sided with Microsoft in the dispute, and some of the states, which have supported Google and advocated a more aggressive stance.
Google has sought to keep a low profile in the dispute, in part because the Federal Trade Commission has recently opened a preliminary antitrust investigation into Google's proposed $3.
1billion acquisition of DoubleClick, an online advertising company.
Lawyers involved in the proceedings said the changes to Vista would allow customers to decide which desktop search program they want to use, and that selecting software from Google or some other company would no longer slow down the computer as it does now.
They said that as part of the settlement Microsoft would let Vista users know how to change their desktop search program.
But the settlement would not require Microsoft to make all the changes that Google has sought.
Google maintain that its desktop search problem was slowed by an equivalent feature that is built into Vista.
When the Google and Microsoft search programs run simultaneously, their indexing programs slow the operating system considerably, Google contends.
As a result, Google has said that Vista violated Microsoft's 2002 antitrust settlement which prohibits Microsoft from designing operating systems that limit the choices of consumers.