A spokesman for the first lady's laywer, Charles Harder, said that the lawsuit was settled for a "substantial sum."
The blogger, Webster Tarpley, also issued a statement in which he said that his article, which he posted on August 2, was "replete with false and defamatory statements about her."
"I had no legitimate factual basis to make these false statements and I fully retract them," he wrote, adding, "I acknowledge that these false statements were very harmful and hurtful to Mrs Trump and her family, and therefore I sincerely apologise to Mrs Trump, her son, her husband and her parents for making these false statements."
Trump has also filed a lawsuit against Mail Media, the parent company of the Daily Mail, but that claim was tossed last month over jurisdictional issues.
Her legal team has refiled the claim in New York state court. The Mail Online retracted its story back in September, but no settlement was reached.
In her New York lawsuit, Trump's attorneys wrote that the publication of the story online had damaged her reputation and commercial prospects.
They wrote that she "had the unique, once-in-a-lifetime opportunity" to "launch a broad-based commercial brand in multiple product categories, each of which could have garnered multimillion-dollar business relationships for a multi-year term during which plaintiff is one of the most photographed women in the world."
While the documents don't specifically mention her term as first lady, the unusual statement about her expected income has drawn swift condemnation from ethics watchdogs as inappropriate profiteering from her high-profile position as first lady, which is typically centred on public service.