Actor Alec Baldwin has said he has reached a civil settlement with the family of the woman he fatally shot with a prop gun on the set of the film Rust last year.

The American actor was holding a Colt gun during a rehearsal for Rust, a Western being filmed in New Mexico last October, when it discharged a live round, killing 42-year-old cinematographer Halyna Hutchins.

"We are pleased to announce today the settlement of the civil case filed on behalf of the family of cinematographer Halyna Hutchins," Baldwin said in an Instagram post.

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"Throughout this difficult process, everyone has maintained the specific desire to do what is best for Halyna's son," Baldwin continued.

Details of the settlement, which also includes Rust Movie Productions, the limited liability company formed to make the movie, were not disclosed.

Baldwin, who was a producer as well as the star of Rust, had been told the gun was safe and has previously said he did not pull the trigger, although an FBI report determined the gun could not have gone off otherwise.

Production on the movie will continue in January, filmmakers said in a statement, with Hutchins' husband Matthew Hutchins taking on the role of executive producer.

"I have no interest in engaging in recriminations or attribution of blame (to the producers or Mr Baldwin)," Matthew Hutchins said in the statement. "All of us believe Halyna's death was a terrible accident."

According to Matthew Hutchins, "all the original principal players" will return to the set.

Rust director Joel Souza, who was also injured in the shooting, said he would devote his work on the film going forward "to honoring Halyna's legacy and making her proud".

"Though certainly bittersweet, I am pleased that together, we will now complete what Halyna and I started," he said in a statement.

The family's lawsuit was one of a series of civil proceedings over the fatal shooting, which sent shockwaves through Hollywood, and led to calls for guns to be permanently banned from sets.

Almost a year on from the tragedy, investigators in New Mexico have filed no criminal charges but have not ruled them out against anybody, including Baldwin.

In August, Baldwin said he did not believe he would be charged, telling CNN he had hired a private investigator to assess possible culpability.

While there has never been any doubt that the gun was in Baldwin's hands when it went off, the central question that remains unresolved is how it came to be loaded with a live round.

Reporting AFP