“There is no reason anymore to demonstrate again,” the head of the Muslim cultural centre at Örebro, Jamal Lahamdi, who had organized two earlier protests, told AFP.
The next protest had been planned for Friday.
“The dialogue is good. The talks organized by the prime minister yesterday are a very good step,” he added.
“I hope the crisis is over now. All the people here were involved, talked a lot.”
Prime Minister Fredrik Reinfeldt said after Tuesday’s talks with Swedish Muslim organizations: “I regret if people have taken offence or feel offended” by the cartoon in a local newspaper, Nerikes Allehanda.
“I personally would never intentionally act in a way that could be perceived by other religions as provocative or offensive,” he said.
Swedes believed that freedom of the press and freedom of expression were “an inalienable part of our country and our democracy,” he added.
The publication of the cartoon on August 18 sparked angry reactions from Muslim countries such as Afghanistan, Egypt, Iran and Pakistan.
The newspaper’s chief editor, Ulf Johansson, said Wednesday he would not be publishing an apology.
“I am sorry if we have offended some of our readers but we are not going to apologize for printing this picture,” he said.
“I have used my right to publish this and the people have used their right to demonstrate and protest in a democratic country.”
The picture was not published on the internet because it was aimed only at Swedish people in the area, he said.
“We only published locally so I am a bit suprised we can offend anyone in Iran, in Pakistan.”
Lahamdi also stressed Wednesday that the problem was a domestic one. “We don’t want to involve all the Muslim people all over the world,” he said.
“This step taken by this government is very good,” he added.
The publication of the cartoon comes a year after deadly riots in several countries against 12 cartoons of the Prophet Muhammad published in Denmark’s biggest daily, Jyllands-Posten.