The 19-year-old defender suffered the injury after landing awkwardly following a heavy collision with Cristiano Ronaldo during Atletico's clash with Real Madrid in the Copa del Rey in mid-February.
He was ruled out for four to six weeks as a result of the injury, but only a month later the club have confirmed he has been able to remove the protective collar he had been wearing.
Manquillo had been made to wear the collar to protect the vertebrae while he maintained his fitness levels with physiotherapists, and Atletico announced he is making "a very good recovery".
The teenager is expected to increase the levels of his training and the title challengers hope to have him available for the final two months of the Liga season.
Manquillo has not been a regular under Diego Simeone this season, and the match with their city rivals was only his seventh start of the campaign in all competitions.
