Katy James was refused leave to remain because her British husband Dominic, a self-employed bike dealer, earns less than Â£18,600 per year.
Mr and Mrs James live in Eastbourne and have a daughter, Madeleine, aged two.
Immigration Minister James Brokenshire has written to their MP to say after an interval review the Home Office would reconsider her application to remain.
Caroline Ansell MP wrote on her website she was confident the government would reverse the decision because "the three have a right to family life under human rights legislation and because of the impact on young Madeleine should Katy be forced to leave."
Katy's father-in-law Jim Needham told BBC Sussex: "It is a great relief, it is early days yet but we are very hopeful things will progress and justice will be done."
The couple, who married in 2006, said they were victims of a rule change in 2012 which requires British citizens with non-EU spouses to prove an income of at least Â£18,600.
Mrs James said on Wednesday it was "outrageous" the Home Office thought a child did not need her mother.
Legal commentator Joshua Rozenberg said the purpose of the income threshold was to prevent non-Europeans marrying into the UK and becoming a burden on the taxpayer.
The government is to reconsider a visa for an American mother facing deportation from the UK.