Israel will pay more than US$1 million to the family of an alleged Mossad spy, known as Prisoner X, who hanged himself in prison in 2010.
"After negotiations, the two parties have reached an agreement whereby the state will pay 4 million shekels (HK$8.6 million) to the deceased's family," the justice ministry said.
The family of Ben Zygier, an Israeli Australian, accused Israel of negligence in dealing with his case.
Zygier was found hanged in his isolation cell in December 2010 - a case Israel went to extreme lengths to cover up.
A court document released on April 25 this year said Israel's prison service had caused Zygier's death by failing to prevent him from committing suicide.
The document revealed details about his background and imprisonment, indicating he was suicidal and had an emotionally charged exchange with his wife the day he was found hanged.
The justice ministry said the deal with Zygier's family was not an "admission of alleged wrongdoing".