The 22-year-old received nine yellow cards and three red cards - and a four-game ban for stamping on Tottenham midfielder Scott Parker - throughout the 2011-12 season, for which the Premier League champion saw fit to discipline the player.
Balotelli took the punishment to a tribunal after refuting the severity, but the club has now confirmed that the striker has withdrawn the external action and accepted the fine "as a sign of respect for Roberto Mancini, the supporters and the club".
A statement from Manchester City read: "After amicable talks between the parties, as a sign of respect for Roberto Mancini, the supporters and the club, Mario Balotelli has chosen to accept a two-week fine levied upon him by the club and withdraw his disciplinary appeal, which was due to be heard by a Premier League panel [on Wednesday].
"Mario remains available for selection for all forthcoming fixtures."
Balotelli has made 11 league appearances for City so far this campaign, scoring just one goal.