The Ukrainian champions were initially ordered by UEFA to play two home European matches in an empty stadium following incidents in the match against Chelsea on Oct 20.
However, UEFA's appeals committee reduced the sanction to one match without fans, which Kiev served against Maccabi Tel Aviv in December, and cut the fine from 100,000 euros ($109,130.00) to 50,000 euros, European football's governing body said in a statement on Tuesday.
The sanctions were handed down for racist behaviour, crowd disturbances and blocked stairways during the match which ended 0-0 at the Olympiyskiy Stadium.
The charges were brought following a prolonged attack against black supporters caught on camera by FARE, the anti-discriminatory Football Against Racism in Europe body.
The video footage, posted by The Guardian newspaper, showed how four black fans, believed to be Afro-American residents in Kiev, were attacked by one set of fans and prevented from leaving the stand, and were then attacked by other fans who also blocked the exit staircase.
Kiev host Manchester City in the first leg of their round of 16 tie on Feb. 24.
UEFA did not say why the sanctions have been reduced.
Last season, UEFA punished Kiev with a partial closure of the stadium following a pitch invasion by supporters during a Europa League Round of 32 second leg match against French club Guingamp in February.
UEFA also fined Dynamo 15,000 euros and ordered them to close part of their stadium again after racist behaviour by fans towards Everton players during a Europa League game in the next round played two weeks later.
(Reporting by Igor Nitsak, writing by Brian Homewood in Zurich, editing by Pritha Sarkar)
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