"Muthulakshmi was taken away by a four-member Tamil Nadu police team this morning," the jail sources told PTI.
Muthulakshmi, arrested by Karnataka police in November 2008, was acquitted in all the five cases against her in Karnataka. She was exonerated of charges in the last of the five cases by a Chamrajnagar court on April 20.
In the last case relating to the gunning down of six policemen by her husband in 1993, the court acquitted her for lack of evidence.
Muthulakshmi was shifted to central jail here six months ago after perceived threats to her safety but was not released as a case was pending against her in Tamil Nadu's Salem district.
Veerappan, one of the most wanted criminals in the country, was shot dead by Special Task Force personnel in 2004.