Members of the Alamogordo City Council voted 7-0 late on Tuesday to offer some 800 of the Atari games found earlier this year for sale on eBay and the council's own website.
The mystery behind who dumped the games in the landfill, and why, inspired the dig and a documentary film by Microsoft Corp's Xbox Entertainment Studios.
The find included hundreds of "E.T. the Extra-Terrestrial" cartridges, considered by some the worst video game ever made.
It flopped after being rushed out to coincide with the release of Steven Spielberg's 1982 hit movie, and it contributed to a collapse of the video game industry in its early years.
Atari is believed to have been saddled with most of the 5 million E.T. cartridges produced. The New York Times reported at the time that the game manufacturer buried the games in the New Mexico desert in the middle of the night.
The unearthed games are under the custodianship of the Tularosa Basin Historical Society and stored at the New Mexico Museum of Space History in Alamogordo, 200 miles (320 km) southeast of Albuquerque.
Joe Lewandowski, who was the dig site supervisor, said the decision by the council to auction more than half of the games was like watching a "phoenix rising from the desert."
"It was like the beginning, end, and a new beginning for the video game industry when we found these games," Lewandowski told Reuters, adding that the sale should begin in two weeks and be complete before Christmas.
He said the city planned to keep some of the remaining 500 or so games as mementos, and the rest of the cartridges will be donated to museums around the world.
"We've already heard from the Museum of Rome, which has a section for video games," he said.
Lewandowski, who admits he doesn't play video games himself, said he became enthralled by the search through a dig site that was 30 feet (nine meters) deep and had a perimeter of 40 feet by 100 feet (12 meters by 30 meters).
"To me, it was a treasure hunt," he said.
© Thomson Reuters 2014
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