Butler, 21, agreed to a plea bargain in exchange for the two felony charges being reduced and dropped, respectively.
The St. Joseph County prosecutor's office said the decision was based on a review of the totality of the circumstances, which included Butler's remorse since the time he was arrested, along with his acknowledgement that the officers on the scene conducted themselves appropriately.
Butler's sentencing was delayed one year while he completes a pretrial diversion program. If he successfully completes the program, the charge would be dismissed.
The resisting law enforcement charge that Butler pleaded guilty to is a Class A misdemeanor. He had been previously charged with a Level 6 felony of resisting law enforcement and a Level 6 felony of battery against a public safety official.
Butler was suspended from the Irish indefinitely following his arrest Aug. 20 outside the Linebacker Lounge, an off-campus bar. His girlfriend and another eyewitness had previously disputed the police account of the arrest to the South Bend Tribune.
A school official said Monday that there is no change in Butler's status with the team following his guilty plea to a lesser charge.
The officer who had arrested Butler, Aaron Knepper, had been named as co-defendant in three separate lawsuits since 2012 that accused him of using excessive force and violating civil rights, according to reports.
South Bend police Chief Scott Ruszkowski had said Friday that there was no wrongdoing in Butler's arrest and that he would not refer the case to the Board of Public Safety. An internal investigation had been opened, Ruszkowski said, because of the large public interest in the case.
Butler wrote a letter of apology Monday to Knepper, saying that he was initially trying to separate others in a fight but understood how Knepper and other officers could have reasonably perceived Butler to be the aggressor.
A Washington, D.C., native, Butler had been expected to miss the first month of this season with a broken left foot that had been re-injured during the summer. The 6-foot-1, 195-pound Butler appeared in 37 games and started three for the Irish, with 39 tackles, six pass breakups, one forced fumble, one fumble recovery and one interception.