Elsewhere in the south, authorities sought the help of a tribal chieftain to persuade government-armed former militiamen to release 47 hostages, even as police prepared a rescue operation.
Both incidents have underscored the lawlessness in a volatile region plagued by bandits, Muslim and communist insurgents and private armies.
Executive Secretary Eduardo Ermita said the martial law edict will be lifted at 9 p.m. local time (1300 GMT) Saturday, eight days after Arroyo signed the controversial proclamation, covering Maguindanao province. The edict suspended the writ of habeas corpus, which allowed police and soldiers to arrest suspects without court warrants.
It was the first time that martial law had been declared since the late dictator Ferdinand Marcos imposed it nationwide more than 30 years ago and ruled by decree until he was toppled in 1986.
Arroyo took the step to enable security forces to move against the Ampatuan clan blamed for the Nov. 23 killings of members of a rival clan and 30 journalists, and accused of fomenting a rebellion to prevent authorities from arresting members of the family.
The Ampatuans have ruled Maguindanao for years and are allies of Arroyo, but the ruling party expelled them days after the killings.
Ermita said a state of emergency declared a day after the massacre, which allows security forces to set up road checkpoints and seize firearms from civilians, will remain in force in Maguindanao and nearby Sultan Kudarat province.
The lifting of martial law followed "accomplishments" by the police, military and the Justice Department in crippling the Ampatuan clan, he said.
He said 24 people, including clan patriarch Andal Ampatuan Sr., have been charged with rebellion and 638 others have been referred to the Justice Department for investigation. Three others, including Ampatuan's son, Andal Jr., have been charged with multiple counts of murder.
The military reported hundreds of assorted firearms, including mortars and machine guns, and hundreds of thousands of rounds of ammunition have been seized in and near properties owned by the Ampatuans.
On Thursday, the military said troops were moving in on strongholds of some 4,000 government-armed militiamen loyal to the Ampatuan clan but no clashes have been reported.
Human rights groups and lawyers - mindful of rights abuses during the Marcos years
- had questioned the constitutionality of Arroyo's imposition of martial law with the Supreme Court. Opposition legislators had accused Arroyo of preparing the grounds for imposing it nationwide.