Dressed in a dark-coloured T-shirt, he seen leaving Maasiyahu prison in central Israel shortly after dawn on Sunday before being driven away.
Israel's Prison Service confirmed through its spokesperson Assaf Librati that Olmert was released early on Sunday morning after serving time for corruption.
He was granted early release by a parole board on Thursday and prosecutors decided not to appeal the decision.
Olmert, who was prime minister between 2006 and 2009, was convicted of corruption and entered prison in February 2016, Al Jazeera reported.
He had been sentenced to 27 months.
Olmert, 71, was a longtime fixture in Israel's hawkish right wing when he began taking a dramatically more conciliatory line towards the Palestinians.
Olmert won international acclaim for relaunching peace efforts with the Palestinians at the Annapolis conference in the US in 2007, but they failed to bear fruit and the corruption charges against him have come to define his legacy.
He resigned as prime minister in September 2008 after police recommended he be indicted for corruption, but remained in office until March 2009, when Benjamin Netanyahu, the Likud leader, was sworn in to the post, which he has held ever since.
The parole board said last week that while Olmert's crimes were "severe," he was "punished for his deeds and paid a heavy price".