Francisco Rodriguez completed a child-support plan with Daian Pena, the mother of his children, on Friday, the Daily News reported.
Terms were not disclosed, but the newspaper speculated Rodriguez would have to share more than a quarter of his $12 million salary.
The newspaper reported K-Rod still faces a civil suit from Pena's father Carlos, whom the reliever pleaded guilty to striking in August at Citi Field.
Rodriguez participated in the hearing before Manhattan Supreme Court Justice Laura Drager by telephone from Pittsburgh.
The case has been settled in an amicable fashion," Rodriguez's attorney, Robert H. Moses, told the Daily News. "Mr. Rodriguez is grateful that he can concentrate on playing baseball."