Judge Juan Eduardo Fuentes said he would examine 40 new pieces of evidence provided by the singer's family.
His widow, Joan Jara, said his murder had become an international symbol in the fight against human rights abuses.
She added that the re-opening of the case "opens the way to continue investigating and searching for the truth".
Tortured and killed
Mr Jara was among thousands of people who were arrested and taken to the Chile Stadium in Santiago soon after Gen Pinochet took power, following a military coup on 11 September, 1973.
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Once there, soldiers broke and burned his hands so that he was unable to play his guitar, witnesses say. He was then shot and killed.
The 38-year-old singer was one of the founding fathers of Chile's New Song movement and a supporter of President Salvador Allende, who was overthrown in the coup.
Judge Fuentes ruled last month that a retired Chilean army colonel, Mario Manriquez, had killed Mr Jara in 1973, but he closed the case after one conviction.
Mr Jara's relatives - who believe the army is shielding other people who may have been responsible - have welcomed the judge's decision to hear more evidence.
Col Manriquez, who was the officer in charge of the stadium where Mr Jara was held, is under house arrest and will be sentenced at a later date.
An official report issued after the restoration of democracy in Chile in 1990 found that 3,197 people died or disappeared during military rule.
© 2008 BBC News