The release of Olivier Grondeau on Thursday comes as France and the rest of Europe try to pursue negotiations with Iran over its rapidly advancing nuclear programme.
US President Donald Trump has sent his own letter to Iran's 85-year-old Supreme Leader Ayatollah Ali Khamenei to jump-start talks.
Trump is also pressuring Tehran over its support of Yemen's Houthi rebels as the American military has launched an intense new campaign of air strikes targeting the group.
In going public with his detention in January, Grondeau alluded to the politics at play in his imprisonment.
"You become a human who has been stocked away indefinitely because one government is seeking to exert pressure on another," he said.
French President Emmanuel Macron wrote online that Grondeau had been freed.
He offered no immediate details of what led to his release, although it came on Nowruz, the Persian new year, when Iran has released prisoners in the past.
Jean-Noel Barrot, France's foreign affairs minister, posted a picture online of Grondeau smiling aboard what appeared to be a private jet.
"We will tirelessly continue our efforts to ensure that all our compatriots still held hostage, including Cecile Kohler and Jacques Paris, are in turn released," Barrot wrote.
Macron also raised their cases.
"Cecile Kohler and Jacques Paris must be freed from Iranian jails," he wrote.
"All my thoughts are with them and their families on this day."
The Iranian government did not immediately acknowledge Grondeau's release.
Such releases of westerners in Iran typically come in exchange for something.
Earlier this week, foreign ministry spokesman Esmail Baghaei said France had arrested an Iranian woman who supported Palestinians, but said Tehran was still trying to gather more details about her case.
Grondeau was detained by Iranian authorities in October 2022 in the city of Shiraz.
Although the exact details of what sparked his arrest remains unclear, his detention began in the chaotic aftermath of the death of Mahsa Amini, a 22-year-old woman who died after being detained over not wearing Iran's mandatory headscarf, or hijab, to the liking of authorities.
United Nations investigators later said Iran was responsible for the "physical violence" that led to her death, which sparked months of protests and a bloody security force crackdown in the country.
He had been held at Tehran's notorious Evin prison, which holds westerners, dual nationals and political prisoners often used by Tehran as bargaining chips in negotiations with the West.
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