Medical watchdog Swissmedic has approved the request, lodged by blood donor service Swiss Transfusion SRC last June, reported news agencies on Tuesday.
Currently, all men in Switzerland who have had sex with another man since 1977 are barred from donating blood – a rule brought in during the 1980s to stop the spread of Aids.
However, medical groups have argued that the presence of new diagnostic tools that can detect HIV/Aids in a matter of days now make a total ban unnecessary.
Under the new Swiss rules, men who have had sex with other men will be allowed to give blood provided they have been celibate in the previous 12 months.
Swiss Transfusion SRC welcomed the move but said it was “far from perfect” since it still excluded many gay people from giving blood.
A second step would be to assess people based on sexual behaviour rather than sexual orientation, said the organization's director Rudolf Schwabe.
Switzerland's stance comes in the wake of a similar relaxing of rules in countries including the US, France and Japan.