Darling said: "I am not prepared to see this crucial investment delayed while Ken Livingstone engages in further legal challenges. The mayor of London's actions leave me no alternative but to take this course of action."
The indemnity means that once the deals reach financial close, the consortiums, Tube Lines and Metronet, will receive cash earlier on in the contract from London Underground.
These payments will offset lost costs if Livingstone does appeal against the European Commission's decision to back the scheme, which was published last month. Livingstone has until February to appeal.
Building revealed in October that financial close for the scheme, originally planned for last month, would be delayed because of the uncertainty over possible legal action.
I’m not prepared to see the deal delayed … the mayor of London’s actions leave me no alternative
Alistair Darling, transport secretary
Both Tube Lines and Metronet welcomed the decision by Darling. Tube Lines chief executive Terry Morgan said: "We are ready to start the long-term investment that the Tube needs."
Tube Lines, which will take over three lines, said it expected to close the deal this month and start work next month, and Metronet, which will refurbish six lines, is due to sign and begin work in the spring.
It also emerged this week that Bechtel and Jarvis are to provide cash-strapped Amey with the £60m it needs for the Tube deal. All three are part of the Tube Lines consortium.