The pair said a settlement was reached on Friday, however, no details of the agreement were disclosed.
In a joint statement with Diddy, Cassie said: “I have decided to resolve this matter amicably on terms that I have some level of control.
"I want to thank my family, fans and lawyers for their unwavering support."
Diddy added: "We have decided to resolve this matter amicably. I wish Cassie and her family all the best. Love."
Following the settlement, Cassie's lawyer said: "I am very proud of Ms Ventura for having the strength to go public with her lawsuit. She ought to be commended for doing so."