Cornwall and the Isles of Scilly are two of only three areas in England which will be in tier one from next Wednesday.
MPs and businesses have welcomed the news and spoken of "relief" at "the end of a difficult year".
The Isle of Wight, Cornwall and the Isles of Scilly are the only areas in tier one.
One Cornwall MP warned against the grading being "grounds for complacency".
Amy Newland, from the White Hart pub in Chilsworthy, said: "I'm extremely relieved, at least we know that we can trade normally."
She added that she felt sorry for pubs in neighbouring Devon which will be under tougher tier two restrictions.
"It's mixed emotions but a huge relief for us," she said.
Paul Eaton, who runs the Royal Inn at Horsebridge, near Tavistock, just inside the Devon border, said: "Some of my regulars are already planning where they can go in Cornwall.
"It's a long border, with pubs scattered both sides."
Kim Conchie, chief executive of Cornwall Chamber of Commerce, said it had been "a difficult year" but this marked "the first stage of securing jobs and companies for our future".
Holiday homes letting agent Lin Wallis in Cornwall tweeted she had five inquiries in 10 minutes after the announcement.
In the seven days to last Saturday the rate of infections in Cornwall was 59 per 100,000 people, the England average was 169.
In the same period there were 337 new cases, down by 176 on the previous week.
Steve Double, Conservative MP for St Austell and Newquay, said Cornwall returning to tier one restrictions was "particularly good news for the thousands of hospitality businesses".
He added: "However whilst we can welcome this news it should be no grounds for complacency."
Tier one means people can meet indoors and out up to a maximum group of six, pubs and restaurants can re-open, closing at 23:00 GMT but people will still be encouraged to work from home.
Differences between the new tiers include restrictions on where households can meet up:
- tier one: the rule of six applies everywhere, indoors and out
- tier two: the rule of six applies outdoors but there is no household mixing anywhere indoors
- tier three: can only meet other households in outdoor public spaces like parks, where the rule of six applies
The system will be regularly reviewed and an area's tier level may change before Christmas - the first review is scheduled for 16 December.