Sudan insists that there is "no reason" for it to be blacklisted, as it has cooperated with US intelligence agencies in fighting "terrorism" - a claim acknowledged by the US State Department.
The Sudanese government said on Wednesday that "it has fulfilled all the necessary conditions relating to the roadmap", stressing that "the U.S. administration is a witness to that and therefore we expect the sanctions to be lifted".
The decision also reflected better human rights conditions in the war-torn Darfur region of western Sudan and more access for humanitarian aid, a senior administration official said.
President Trump issued a pair of Executive Orders that the State Department says came after "the Government of Sudan's sustained positive actions".
According to a second administration official, who also briefed reporters on the policy change, Sudan has pledged not to pursue arms deals with Pyongyang going forward.
For two decades, the comprehensive United States sanctions crippled the Sudanese economy, increasing debt and inflation, and paralyzing the banking sector.
"We will not necessarily take the government at their word", one official said.
"This is a first step towards a full normalisation of relations between Sudan and the West".
It will improve that country's diplomatic ties with Washington and allow the unfreezing of Sudanese assets.
The statement also said Sudan was looking forward to building natural and progressive ties with the USA, "but this necessitates removing Sudan's name from the list of countries sponsoring terrorism". On Oct. 6, the United States formally lifted partial sanctions on Sudan.
Shortly before leaving office, former U.S. President Barack Obama temporarily eased penalties against the east African nation.
Officials cited improvement on human rights, on the mitigation of conflicts within Sudan and progress on counter-terrorism for the decision. The sanctions had cut Sudan off from much of the global financial community.
Democratic U.S. Representative Jim McGovern said the sanctions decision "legitimizes the murderous actions of the Sudanese government" and warned that "any back-sliding will likely result in Congress reinstating sanctions".