Fares and tolls could go up by 4 percent in 2015, and again in 2017, instead of the projected 7.5 percent.
The MTA says any loss in revenue will be offset by keeping costs down.
Subway riders were pleased to hear they'll be getting a break on the fare increases.
"It's better for me. I mean I'm a high school student. Money's very tight. So it's great for me," said Tatyanna Morris.
"It's surprising but it's good news. Maybe it has something to do with good management. Let's hope so," said Gail Donoghue.
Better management is exactly the reason, according to the MTA. That, and higher than expected ridership, along with a boost in tax revenue. It all means about $1 billion more than the MTA had expected.
"We wouldn't come forward with a presentation like this if we felt there was no likelihood of doing it," said MTA Executive Director Tom Prendergast. "We think there's a high likelihood of us being able to do that."
And it's not just a smaller than expected fare hike. The MTA also plans on increasing service. Several bus lines in Manhattan, the Bronx and Queens will see lines extended or more Sunday service.
"It would be fantastic if they could increase service on that line," said LIRR passenger Rich Mercante. ('Even on the weekend, it would be good?') "Oh absolutely. If you live on Long Island you ought to come in to the cities on the weekend."
"And what do I think about it? Cheaper is always better. I would like it if it don't go up. I could use every dollar these days. It's not easy living in New York," said LIRR passenger Liam Harkin.