A government source said: "The attorney general has approved this morning the settlement that was reached with Prince Alwaleed bin Talal, and the prince returned home at 11am."
Family sources said Prince Alwaleed was released on Saturday, with one revealing: "He has he arrived home."
The decision to release Prince Alwaleed and several other well-known tycoons on Friday, suggested the main part of the corruption probe was winding down after it sent shockwaves through Saudi Arabia's business and political establishment.
Prince Alwaleed had been confined at the Ritz-Carlton since early November, along with dozens of others, part of Crown Prince Mohammed bin Salman's plan to consolidate control and reform oil superpower Saudi Arabia.
Saudi authorities have said they expect to raise some US$100b for the government through such settlements - a huge windfall for the state, which has seen its finances squeezed by low oil prices.
Allegations against Prince Alwaleed included money laundering, bribery and extorting officials, a Saudi official told Reuters in November.
In his first interview since he was taken into custody, conducted hours before his release, Prince Alwaleed said he was continuing to maintain his innocence of any corruption in talks with authorities.
He said he expected to keep full control of his global investment firm Kingdom Holding Co without being required to give up assets to the government.
The senior Saudi official, asked if the attorney general was convinced of the innocence of Prince Alwaleed, said: "I will not negate or confirm what he says. Generally this falls back to those who concluded the settlement, and for sure there is no settlement unless there are violations and they are not concluded without the accused admitting it in writing and promising not to repeat it."
The release of Prince Alwaleed, whose net worth has been estimated by Forbes magazine at US$17b, is likely to reassure investors in his global business empire as well as in the Saudi economy broadly.
Directly or indirectly through Kingdom Holding, he holds stakes in firms such as Twitter and Citigroup, and has invested in top hotels including the George V in Paris and the Plaza in New York.
He described his confinement as a misunderstanding and said he supports reform efforts by the crown prince.
He told Reuters: "There are no charges. There are just some discussions between me and the government."
Prince Alwaleed appeared greyer and thinner than in his last public appearance, a television interview in October, and had grown a beard while in detention.
He said: "I have nothing to hide at all. I'm so comfortable, I'm so relaxed. I shave here, like at home. My barber comes here. I'm like at home, frankly speaking."
He granted the 30-minute interview, including a tour of his suite, partly to disprove rumours of mistreatment and of being moved from the hotel to a prison.
The prince said he was able to communicate with family members and executives at his business during his time in detention.
Prince Alwaleed showed off the comforts of his gold-accented private office, dining room and kitchen, which was fully stocked with his preferred vegetarian meals.
In the corner of his office sat tennis shoes, which he said he used regularly for exercise. A television played business news programmes, and a mug with an image of his own face on it was perched on the desk.
After being released, Prince Alwaleed said, he plans to continue living in Saudi Arabia and to return to the challenge of juggling his global business interests.
He added: "I will not leave Saudi Arabia, for sure. This is my country."
