"The 54-year-old who was arrested yesterday on suspicion of conspiracy to murder has tonight been released on bail until July 31 pending further enquiries," said Surrey police on Tuesday in a statement on its website.
Eric Maillaud, the prosecutor in charge of the case in France, told AFP on Tuesday that the suspect Zaid al-Hilli was released at around 6pm GMT and faces a number of unspecified conditions in his bail terms.
He added that "no charges" had been laid against him and that "the investigation is continuing."
Zaid al-Hilli was detained on Monday in Surrey, near London, on suspicion of conspiracy to commit murder in what British police said was a "pre-planned arrest".
His brother Saad, Saad's wife Iqbal and her mother Suhaila al-Allaf were killed in the family's BMW estate car in a car park at a beauty spot near Lake Annecy on September 5th last year.
A French cyclist, Sylvain Mollier, was also gunned down, although investigators believe he was not a target and was just in the wrong place at the wrong time.
The al-Hillis' two young daughters survived the shooting, one of them by huddling next to her dead mother's body for hours until police found her.
Zaid al-Hilli was taken to a police station after the early-morning arrest in Surrey, where his murdered brother had also lived.