But they would rather it was a permanent fix.
The route D130302 bus service, which has operated for more than 30 years, was due to be terminated on September 27, the end of term three.
But the ministry on Monday extended funding until the end of term four after "after considering feedback from affected caregivers", ministry school transport group manager James Meffan said.
About 50 children from Waverley, Sandymount and Shiel Hill, who attend South Dunedin schools, including Tahuna Normal Intermediate, Queen's High School and King's High School, use the service to and from school.
Grants Braes School deputy principal Sara Carr said her school community was "elated" by the announcement.
"It’s great news. It was a firm no initially.
"It’s just taken that pressure off to try and get a solution."
She and Grants Braes School teacher Jen Stevenson had shared their concerns about the service ending at an Otago Regional Council meeting last month.
This was a temporary fix and without the bus the children would need to find alternative transport to and from school, she said.
"At the end of the day the children will either have to bike or walk."
There was no public bus that went to the schools.
A meeting at Tahuna Normal Intermediate with parents and principals was held last month and the feasibility of a private bus was discussed.
That would cost each student $500 per term, Mrs Carr said.
Principals of schools on the route were pleased with the outcome though still concerned about the long-term situation.
Tahuna Normal Intermediate principal Simon Clarke said it had been good work well done to find a temporary solution, but his ultimate worry was students may have to take a public bus that took them only some of the way to school and there was potential they would be left on the side of the road due to overcrowding.
Queen's High School principal Barbara Agnew said it was great the bus would continue for at least another term.
"We want parents to get their kids to school easily and safely. We’re doing what we can to support that."
King’s High School rector Nick McIvor said this would give the schools valuable time to find more ways to find achievable transport options for the affected students.
Regional council transport manager Lorraine Cheyne said the council and the ministry were in discussions about several school bus changes.
