The 28-year-old singer's recent album 'How I'm Feeling Now' was written, recorded and released during quarantine in Los Angeles and - after being inspired by the organisation's work to help the city's homeless population - she decided to donate all profits from the LP's merchandise to the cause.
Daniel Conway - a policy advisor with the LA Alliance - said: "LA Alliance for Human Rights brought this lawsuit because we want to see a humane and collaborative approach to rapidly getting the neediest amongst us off of the streets.
"If more artists and leaders would step up the way Charli has, we would start to see real improvements in Los Angeles' homelessness crisis.
"The LA Alliance is grateful to Charli and her team for their incredible generosity."
As well as the album profits, she also auctioned off artwork created for the record, while additional funds were raised by a special Boiler Room livestream.
Charli previously revealed she'd always planned to make a record this year while she was "shut off" from the world so she took advantage of having the time alone to be "creative" and it provided a welcome distraction to her.
She explained: "I wanted to do an album at the end of the year... we wanted to do something in like, you know, a month, two months.
"Like, going to one place, like really shutting off the world and focusing in on just making music. Very quickly and fluidly and putting it out quite soon after we'd completed it.
"And so the idea to do something like that was already there, so I just thought, once the lockdown begun, and I was in that position anyway... 'Why don't I just do that now?' Because this time feels very fruitful for me as a creative."