The 48-year-old, who was sent by the North through the border village of Panmunjom, is currently being investigated by South Korean officials over why he entered the North without government permission, said an official from Seoul's Unification Ministry, who didn't want to be named, citing office rules.
The man, identified only by his surname Lee, was detained by North Korean officials on September 30 after entering the North from China.
The ministry official said the North did not elaborate on the circumstances of Lee's entry and said it was releasing him as a humanitarian gesture.
North Korea last month freed Won Moon Joo, a South Korean national who is a student for New York University, six months after he had been arrested for crossing the border from China into North Korea.
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The release of Joo, whose alleged crime was relatively minor, was seen by analysts as a sign that Pyongyang was trying to improve its ties with Seoul.
North Korea has been holding another South Korean man since late 2013 for allegedly spying and trying to set up underground churches in the North.