The Jordanian cabinet revoked Article 308 on Sunday, after years of campaigns by women's activists, as well as Muslim and Christian scholars and others.
The law had meant rapists could avoid a jail term in return for marrying their victim for at least three years.
Its supporters said the law protected a victim's honour and reputation.
'A dream come true'
But last year, it was amended so a rapist could only marry his victim if she was aged between 15 and 18 and the attack was believed to have been consensual.
Then in February, a royal committee suggested the law should be scrapped in its entirety.
At the time, the move was welcomed by activist Lailla Naffa as a "dream that has come true," according to the Jordan Times.
However, the fight to end the loophole in other Middle Eastern countries is far from over.
As Jordan was abolishing Article 308, Lebanese activists were hanging wedding dresses along Beirut's famous sea front, in protest against Lebanon's version of the law.
They are hopeful it will be scrapped in May.