The so-called "Satan shoes" which allegedly contained a drop of human blood are to be recalled following a lawsuit from Nike.
Nike had filed a trademark infringement lawsuit against MSCHF Product Studio, the sellers of the footwear.
As part of the settlement, the shoes will be recalled and buyers will be refunded by MSCHF "to remove them from circulation".
Only 666 pairs were made, and they sold for $1,018 (£741) a set.
The black and red trainers also had the words "Luke 10:18" printed on them – a reference to a Biblical verse that alludes to Satan's fall from heaven.
They also had the Nike tick on them.
More from Lil Nas X
Nike sues company behind Lil Nas X's blood-filled 'Satan Shoes'
Rapper Lil Nas X takes heat for launching 666 custom Nike human blood 'Satan' trainers range
Abbey Road goes virtual as jazz musician Theon Cross is turned into 3D avatar for SXSW Festival in Texas
Lizzo dominates as women lead Grammy Award nominations
Lil Nas X: Old Town Road breaks records in US for longest-reigning No 1
As well as the Satan shoes, refunds will also be offered by MSCHF to those who bought the Jesus shoes, also based on the Air Max 97, which were launched in 2019.
Limited edition shoes like these become collectors items and can reach values many times more than the original price on the second-hand market.
David Bernstein, chair of the intellectual property litigation group at Debevoise & Plimpton and MSCHF representative, said the artistic messages MSCHF hoped the shoes would convey were "dramatically amplified" by Nike's lawsuit.
He said: "MSCHF intended to comment on the absurdity of the collaboration culture practiced by some brands, and about the perniciousness of intolerance.
"Having achieved its artistic purpose, MSCHF is pleased to have resolved the lawsuit."
Lil Nas X was not listed as a defendant in the litigation.
He was supposed to choose a special recipient of a pair of the shoes, but was not able to when a Brooklyn judge stopped sales on 1 April.
Nike has claimed that even those who collect shoes were confused about who was making the Satan shoes.
MSCHF said the shoes were "individually numbered works of art" and did not cause confusion.
Lil Nas X released a devil-themed video for his song Montero (Call Me By Your Name) in March.