Gay, the world's joint second fastest man, last month had accepted the one-year suspension by the U.S. Anti-Doping Agency (USADA) after a 2013 positive test for an anabolic steroid.
The ban was backdated to June 23, 2013, making the U.S. 100 metres record holder eligible to return to running later this month. His first race will be a 100 metres at Lausanne's Diamond League meeting on July 3, organisers said on Monday.
Normally athletes receive a two-year suspension for their first major doping offense but under anti-doping rules the ban can be reduced for substantial cooperation.
The U.S. agency said Gay was eligible for such a reduction because the sprinter offered what it termed substantial assistance in his case.
On Tuesday, WADA said it was satisfied with the decision.
"After careful review and scrutiny of the full case file, WADA is satisfied that Mr. Tyson Gay provided substantial assistance to USADA in an appropriate fashion," the global agency said in a statement to Reuters.
"WADA will therefore not appeal USADA’s decision which is compatible with the World Anti-Doping Code."
Officials of the International Association of Athletics Federations (IAAF), which also can appeal the U.S. decision, declined comment, saying the matter remains in the hands of its doping review board to assess.
IAAF president Lamine Diack, however, told Reuters last month he supported the World Anti-Doping Code rule that allows athletes to receive reduced sentences if they provide substantial assistance to anti-doping agencies.
"In the fight against doping we have to use this," Diack said in an interview at the inaugural IAAF World Relays in the Bahamas. "If someone gave really very good cooperation and give us the possibility to do more to fight doping, we have to do something."
In addition to the ban, Gay has returned the silver medal he won as a member of the U.S. 4x100 metres relay team at the 2012 London Olympics.
His former coach Jon Drummond has filed a defamation lawsuit against the sprinter, USADA and USADA chief Travis Tygart, claiming Drummond was falsely accused of supplying Gay with performance-enhancing drugs.
USADA called the lawsuit "baseless."
(Reporting by Gene Cherry in Raleigh, North Carolina; Editing by Frank Pingue)
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