In the complaint, an unnamed woman says she was flown from the Detroit area to New York on a private plane and gang-raped in a recording studio. Mr. Combs denied the allegations.
The music mogul has been celebrated as a transformative force in hip-hop, but fallout from new accusations of abuse has impacted some business relationships and his legacy.
The R&B singer Casandra Ventura and the music mogul did not disclose terms of the settlement, which came one day after Ms. Ventura filed an explosive complaint.
The music mogul, who was accused of sexual abuse by a former romantic partner, fueled the commercial success of rap over a 30-year career dotted by allegations of violence.