Habyarimana was refused residency papers in July and ordered to leave the country on grounds that she constituted "a threat to public order". She has lived in France since 1994 and was placed under judicial investigation in 2008, after Rwanda sought her extradition for complicity in the genocide.
At Monday's hearing, the French court adjourned its decision on the extradition request. Re-examining the residency request automatically suspended the extradition proceedings, but a decision is expected on 2 November.
"The public arbitrator pointed out that there were a few irregularities in the extradition request and said her family situation, which entitles her to live in France, should be re-examined," said her lawyer Philippe Meilhac.
In September, French judges refused to extradite Rwandan doctor Eugene Rwamucyo, who is suspected of participating in the 1994 genocide. And a panel of French experts visited Rwanda to determine the cause of the crash that killed Juvenal Habyarimana. Their verdict is expected by March 2011.
Some 800,000 Tutsis and moderate Hutus were killed between April and July 1994 during the Rwandan genocide.