A-level and GCSE students will be awarded the grades predicted for them by their teachers, the Welsh Government has announced.
The U-turn followed criticism from students, opposition politicians and Welsh Labour backbenchers.
Education Minister Kirsty Williams said she took the decision to maintain confidence in the system.
A total of 42% of A-level grades predicted by teachers had been lowered when Welsh results were published last week, after they had been processed by an algorithm.
Ms Williams said that “given decisions elsewhere, the balance of fairness now lies with awarding centre assessment grades to students, despite the strengths of the system in Wales”.
She promised an independent review of the events “following the cancellation of this year’s exams”.
The change also affects AS-levels, skills challenge certificates and the Welsh Baccalaureate.
But students who received higher grades than those predicted by teachers will keep them.