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Newman, of Palo Alto, Calif., was pulled from a plane Oct. 26 while preparing to leave the communist nation after a 10-day tour. Newman, a former finance executive, has a heart condition and his family had been worried about his health since he was detained while trying to leave the country on a tourist visa.
"We are pleased that Mr. Merrill Newman has been allowed to depart the DPRK and re-join his family. We welcome the DPRK's decision to release him," the State Department said in a statement late Friday.
Newman, who has yet to speak publicly about the ordeal, first went to China. He was expected to arrive home Saturday morning in San Francisco. [UPDATE: Newman arrived home today.]
Vice President Joe Biden, who is in Seoul, where he is wrapping up his three-country Asia tour, said that his offer to give Newman a ride was declined.
"The DPRK today released someone they never should have had in the first place, Mr. Newman. I'm told -- we tried to get in contact with him -- he's on his way or in China now. I offered him a ride home on Air Force Two, but as he pointed out, there's a direct flight to San Francisco, so I don't blame him, I'd be on that flight too."
North Korea claimed that Newman was being held for "hostile acts" he had allegedly committed during his trip.
In a video released last weekend by North Korea's state-run media, Newman read an apology for his participation in training and advising a U.S.-led North Korean partisan unit during the Korean War.
"I have been guilty of a long list of indelible crimes against DPRK government and Korean people," Newman said in a statement that North Korea claimed he had written.
At the time U.S. officials could not confirm his wartime role, but U.S. military records released last week to ABC News confirmed that in 1953 Newman had served in a special forces unit that advised Korean partisans who fought in North Korea behind enemy lines
A former group of South Korean guerrillas say Newman advised them as they fought behind enemy lines during the war. Some members have expressed surprise that Newman would take the risk of visiting North Korea given his role with their group, which is still loathed and remembered in the North, AP reported.
"This positive decision by the DPRK throws into sharper relief the continuing detention of Mr. Kenneth Bae, who has been in DPRK custody for over a year. We call on the DPRK once again to pardon and grant Mr. Bae special amnesty and immediately release him as a humanitarian gesture so that he too can return home to his family. The U.S. Government will continue to work actively on his case," the State Department said in the statement. " We thank the Government of Sweden for the tireless efforts of the Embassy of Sweden in Pyongyang, which acts as our Protecting Power in the DPRK."
Newman's wife, Lee, told ABC News last month that didn't understand why her husband was being detained, but hoped the situation could be resolved soon so the family can spend the holidays together.
"We just hope whatever that misunderstanding is will be resolved very quickly and that he can return and be at our table for the holidays," Lee Newman told ABC News.
Merrill Newman was traveling with a group out of Beijing on a tour bus through North Korea. On Oct. 26, what was to be Newman's last day in North Korea, he was taken off of a plane set to leave the country and detained by authorities.
"They had checked out of the hotel, gone to the airport, boarded the plane," Jeffrey Newman said. "We understand [they] were five minutes from taking off when the Korean official came aboard, asked to see his passport then asked the stewardess to ask him to leave the plane and he left the plane with apparently no incident or drama and he's been there ever since."
Lee Newman says her husband had in place all necessary and valid travel documents to take the tour.
"We have no idea that how with the guides and the visas and the paper and the itinerary that there could be anything that could've gone off track," Lee Newman told ABC News.
The Swedish Embassy was negotiating on a daily basis on behalf of Newman because the U.S. has no diplomatic ties to North Korea, the State Department said.
Jeffrey Newman said it was his father's dream to return to the country where he spent three years as an infantry officer during the Korean War.
"He'd been to the peninsula before about three years ago. He was in South Korea but he'd never been to North Korea and he'd always wanted to go back," he said. "He had a great respect for the Korean people and a keen interest in the Korean culture."
North Korea has detained at least six Americans since 2009, including two journalists accused of trespassing and several missionaries accused of spreading Christianity. Bae, a Korean-American missionary and tour operator, has been detained for more than a year.
The Associated Press contributed to this report from Seoul, South Korea.