"The probation officer is pleased with your progress. You seem to be getting your Life back on track and that's what we all hoped for," Los Angeles Superior Court Judge Stephanie Sautner told Lohan.
"It was never our goal to just put people in jail, we like to see...change, and I think we've all seen that," she said.
The "Mean Girls" actress, 25, wore a mint green form-fitting dress to her third progress hearing for her five-month court-ordered community service and therapy sessions sentence.
Lohan must complete 14 more days of community service at the Los Angeles County morgue and five more therapy sessions before her final hearing scheduled on March 29.
If she completes all her requirements by then, her probation from a 2007 drunk driving case in Beverly Hills will end, and her formal probation stemming from her theft charge will be downgraded to summary probation, under which Lohan will no longer need to check in with a probation officer.
"After March 29, all you have to do is obey all laws, stay out of trouble, move on with your life," Sautner said.
Until then, the actress is only allowed to leave California for Work purposes.
Lohan is scheduled to host U.S. comedy sketch show "Saturday Night Live" on March 3, a much-anticipated comeback for the actress, who last hosted the show in 2006 at the peak of her career.
The actress rose to fame as a likable child star of Disney movies such as "The Parent Trap" and comedies such as "Freaky Friday," but has made numerous trips to rehab and jail since 2007.
Lohan admitted stealing a $2,500 gold necklace from a jewelry store in Venice, California in January 2011, and was sentenced to 480 hours community service. (Reuters)
