The council voted to approve a new Entertainment Permit Ordinance and repeal the ban.
Davis Mayor Dan Wolk says the city hasn't had many regulations on downtown entertainment venues that stay open late at night.
"And that was part of the problem," says Wolk. "And so what this does is it sets up a process where, if you're a restaurant or a bar, you have to apply for and receive an entertainment permit."
The new ordinance puts permitting power in the hands of the police chief and sets up several conditions.
"There's going to be a fee associated with it," says Wolk. "And those conditions are going to get to closure times, they're going to get to things like safety training for staff."
Wolk says the new regulations are the result of community dialogue with nightclub and bar owners. There was no organized opposition to the ordinance.