Mofid Abdel Kader Mashaal, the brother of former Hamas political wing chairman Khaled Mashaal was unexpectedly released from the US prison where he was held, Walla reported on Friday morning.
The sudden release comes amid talks regarding a possible hostage deal.
The US has not confirmed the release of Mashaal, but the news has been widely reported in Arab media.
Mashaal was sentenced for 20 years on charges of financing Hamas through the Holy Land Foundation. According to Israeli media, he has been released after serving 16 years, and will spend one year in a rehabilitation facility.
Allegedly, the shortening of Mashaal's term comes alongside the shortening of four other American-Palestinians, including Muhammad al-Zain, a relative of Hamas Deputy Chairman Musa Abu Marzouk. The US court ruling, Arab media stated, means that the sentences will be shorter by "dozens of years."
Biden administration commutes sentences
The Holy Land Foundation, which is prohibited, used to be one of the largest Islamic charitable organizations in the US.
On Thursday, President Joe Biden announced that he was commuting the sentences of some 1,500 individuals and pardoning 39 people convicted of non-violent crimes, the largest such act in US history. It is not clear whether the reports of the release of Mashal are connected to this.