Two days after a court here granted him bail in a case related to the killing of Lal Masjid cleric Abdul Rashid Ghazi, Musharraf submitted two surety bonds of Rs 1 lakh each.
His lawyer Ilyas Siddiqui said, "Musharraf is a free man now."
The 70-year-old former President has been under house arrest at his sprawling farmhouse on the outskirts of Islamabad and aides said the notification declaring it a "sub-jail" would be withdrawn soon.
Mr. Musharraf had already been granted bail, but not acquitted, in three other cases in which he was implicated: the 2007 assassination of former Prime Minister Benazir Bhutto, the 2006 death of a rebel tribal leader, Akbar Bugti, and the arrest in late 2007 of the country's senior judiciary.
However, staff from Rawalpindi's Adiala Jail continued to be deployed at the farmhouse in Chak Shehzad.
Militants regard Musharraf as a main target
APML leaders and supporters gathered outside the farmhouse and distributed sweets. A large media contingent too was present.
Ahmed Raza Kasuri, a senior member of Musharraf's legal team, said his release was not part of any deal.
Besides the Lal Masjid case, Musharraf has been granted bail in three other cases registered against him over the assassination of former premier Benazir Bhutto in 2007, the killing of Baloch leader Akbar Bugti in a 2006 military operation and the imposition of emergency in 2007.
Militants regard him as a top enemy for his role in ordering the bloodshed at the Red Mosque, an event that led to the formation of the militant group Tehreek-e-Taliban Pakistan, known as the Pakistani Taliban.
Musharraf's farm house has extensive security, with high walls and police guards, as the TTP had warned that it has formed a special hit squad to kill him.
In 1999, Musharraf, then the head of the army, took power through a coup. He was later ousted by popular protests led by the country's judiciary. He went into exile in 2008.
The cases were filed after he returned to Pakistan from self-exile in March to revive his political career. However, a court barred him from contesting polls for life.
(With agency inputs)