The City of Minneapolis agreed on Friday to pay $20million ($28million AUD) to the family of Justine Ruszczyk Damond who was fatally shot by a police officer when she approached his squad car after calling 911 to report a possible sexual assault.

Mayor Jacob Frey and City Council members detailed the settlement just three days after a jury convicted Mohamed Noor of murder and manslaughter in the 2017 killing.

Damond, a dual citizen of the U.S. and Australia, had called 911 to summon officers to a possible rape in the alley behind her house.

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The City of Minneapolis will pay $20million to the family of Justine Ruszczyk Damond (left), after a jury convicted former police officer Mohamed Noor (right) of her murder

News of the settlement comes just days after Damond's family, including her father, John (pictured) filed a lawsuit seeking more than $50million

The yoga instructor was shot dead a month before she was scheduled to marry her fiance, Don Damond (pictured), who spoke after Noor's guilty verdict

The settlement is believed to be the largest stemming from police violence in the state of Minnesota, and roughly four to five times as large as any settlement paid out in recent years.

When asked whether race played a role in the swift settlement or in its amount - Damond was white, Noor is Somali American - Frey said this case stood out because of Noor's unprecedented conviction for third-degree murder, as well as the officer's failure to identify a threat before he used deadly force.

'This is not a victory for anyone, but rather a way for our city to move forward,' he said. 'I do believe that we will move forward together, united in the shared belief that such a tragedy should never occur in our city.'

Noor and his partner were driving down the alley in a police SUV when they say they were startled by a loud bang on the vehicle.

Noor testified that he fired to protect them from a perceived threat, after he saw his partner's terrified reaction, and saw a woman in a pink top and pajama pants appear at the driver's side window, raising her right arm.

Jurors took more than 11 hours to reach a verdict after hearing three weeks of testimony.

News of the settlement comes just days after Damond's family filed a lawsuit seeking more than $50million, alleging that her civil rights were violated.

Damond was unarmed when she was shot by Noor after reporting a possible sexual assault near her home in July 2017

The settlement, which will be paid by the city's self-insurance fund, calls for Damond's family to donate $2million to a local foundation's fund aimed at addressing gun violence.

City leaders commended the family for addressing the broader issue of police violence, particularly affecting communities of color.

During a press conference on Tuesday, Justine's father, John Ruszczyk, called the trial a 'painful journey' but said he was 'satisfied with the outcome'.

The death of Damond, a 40-year-old yoga instructor, came a month before she was due to marry. Noor, 33, who had trained to become a police officer in a mid-career switch, was fired after he was charged.

He is in custody awaiting sentencing in June. Sentencing guidelines call for as many as 15 years in prison on the murder charge, though judges can depart from the guidelines.

Prosecutors criticized Noor for shooting without seeing a weapon or Damond's hands. They also questioned whether the loud bang was real.

Neither Noor nor his partner, Matthew Harrity, mentioned it to investigators at the scene, with Harrity first mentioning it three days later in an interview with state investigators. Noor refused to talk to investigators.

Damond's death angered and bewildered citizens in the U.S. and Australia, and led to the forced resignation of Minneapolis' police chief. It also led the department to change its policy on body cameras.