The state of emergency declared late last month in Hokkaido was set to end late Thursday amid signs the spread of the virus has been abating in the prefecture.
"There has not been a surge of infected patients significant enough to cause a collapse of the health care system. The situation has not become as threatening as I had feared," Gov. Naomichi Suzuki said at a news conference Wednesday.
"We're now able to battle (the virus), as we've strengthened the test capability and bed capacity in hospitals," he said.
Hokkaido has the highest number of infections among all prefectures. It will still request that people avoid going to high-risk areas.
Suzuki declared the nonbinding state of emergency covering the period from Feb. 28 to March 19 and asked residents to stay indoors on the weekend.
As of Wednesday, a total of more than 150 people had been confirmed to be infected in Hokkaido, while the total number was around 900 nationwide excluding the virus-hit Diamond Princess cruise ship.
After the declaration, the newly infected numbers remained low compared with the peak, which was 15 in a day on Feb. 27. But the number started to rise from March 6 in Sapporo.
Following the declaration, the economic impact, particularly on restaurants, was substantial due to the request that residents stay home, according to a survey by a federation of small and midsize companies.
In the report, one company said, "Not only has the number of tourists decreased but local customers as well. There could be companies that go bankrupt."