Under the terms of the settlement agreement, Amazon will pay the $51 million within 45 days of the June 11th settlement date, which coincides with Amazon's third quarter.
Amazon said that the payment would be charged to ‘other operating expense’ in its second quarter.
The lawsuit was over a partnership that gave Toys R Us rights to supply certain toys on Amazon's site.
Toys R Us claimed Amazon violated the partnership by letting others sell the toys on its site. Amazon said the toy retailer had failed to keep the items in stock.
The partnership was originally struck in 2000 and was planned to last until 2010.
The settlement comes after an appeals court ruled against Amazon, agreeing with a lower court's 2006 ruling that Amazon breached its contract.
Toys R Us had not specified the amount it was seeking, but the settlement will take the place of a court award.