Benzema is being investigated for his part in an alleged plot to blackmail France team-mate Mathieu Valbuena.
The Real Madrid player - who denies wrongdoing - was not allowed to contact Valbuena, meaning they could not be in the same squad, but an appeals court has partially lifted some restrictions.
However Benzema, who is injured, was suspended from France duty in December.
That ban was due to stand until the end of court proceedings.
An investigating judge last month lifted the order keeping Benzema and Lyon playmaker Valbuena apart, but the prosecutor appealed. That was dismissed on Friday.
Benzema's lawyer, Sylvain Cormier, described the decision as "a first step".
The 28-year-old forward faces preliminary charges of conspiracy to blackmail relating to an extortion scam over a sex tape involving Valbuena.
If found guilty, he could face a minimum of five years in prison.
According to French media, Benzema mentioned a sex tape to Valbuena, 31, during a national team training session at Clairefontaine on 5 October.
Benzema told police he was advising a friend about what to do in a difficult situation.
But he could face charges for complicity in attempted blackmail and participation in a criminal conspiracy.
Striker Karim Benzema will be eligible to play for France at Euro 2016 after some legal restrictions were lifted.