Tarek ibn Ziyad Academy in Inver Grove Heights came under state scrutiny regarding prayer sessions after school. Critics accused its founders of running a publicly funded madrassa, or religious school.
In a letter to the school, though, state officials said most of the operations at the school were in compliance with state and federal law.
But it also said the school needs to better separate religious expression from the school day.
The Minnesota Department of Education said that extracurricular prayer can't happen in the school itself and that kids who don't want to participate should have an option to go home earlier.
The school's director, Asad Zaman, said he felt the state review was largely positive.
"We take these concerns seriously, and we look forward working with the Department of Education, with our faculty and parents to address these concerns in the very near future," said Zaman. "We are glad this report has come out because it shows that we have been providing our over 400 children with a quality education that is based on academics, and not religion."
The school serves children in Kindergarten through eighth grade.