"We can confirm that US citizens Kenneth Bae and Matthew Todd Miller have been allowed to depart the DPRK (North Korea) and are on their way home," Xinhua quoted the Office of the Director of National Intelligence as saying in a statement.
It said James Clapper, the director of National Intelligence who engaged in discussions with Pyongyang about the release of the two detainees, was accompanying them on their way home.
The latest development came after North Korea let go another American detainee Jeffrey Fowle Oct 21.
State Department spokeswoman Jennifer Psaki welcomed North Korea's new move. However, she reiterated the agency's "strong recommendation" against all travel by US citizens to the Asian country.
Psaki also thanked the Swedish government, which represents US interests in North Korea, for its help in securing their release. Washington and Pyongyang do not have diplomatic ties.
Bae, 42, and Miller, 24, had been held by North Korea for two years and seven months respectively. They were sentenced to separate hard labour of 15 years and six years by Pyongyang.