By MOLLY HUNTER and ADAM MAKARY

CAIRO - Egypt's former president Hosni Mubarak was acquitted of an outstanding corruption charge by Cairo's Criminal Court today, possibly clearing the way for his release from prison his lawyer said.

The news comes as Egypt descends into chaos following the ouster of its second president in just over two years, Mohamed Morsi, who was elected last year to replace Mubarak.

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In a statement, the court said it was referring the corruption case back to the public prosecutor's office "to decide on how to legally proceed." The prosecutor's office is expected to review the case on Wednesday. Monday's corruption case is related to illegal gifts Mubarak allegedly received while in office, but he recently repaid the monetary value of those gifts in an effort to expedite his release.

Following today's ruling, Mubarak's lawyer, Fareed El Deeb, triumphantly announced that his client would be released within days. Deeb, who has defended the deposed leader relentlessly for the last two years, has a flare for the dramatic and at times overstatement.

"All we have left is a simple administrative procedure that should take no more than 48 hours," Deeb told Reuters. "He should be freed by the end of the week."

But judiciary sources tell ABC News the former president won't be a free man for at least a couple of weeks.

Adding further complication, the prosecutor's office leveled another charge today, accusing Mubarak of inciting violence against his successor and the Muslim Brotherhood while in office. Egypt's penal code technically sets a maximum detention of 18 months without conviction, but Mubarak is approaching month 22 as the list of charges continues to grow.

Last summer Mubarak, 85, was sentenced to life in prison for his failure to stop the killing of hundreds of civilians during the 18-day revolution of 2011. After appealing the decision in January, Egypt's highest appeals court ordered a retrial.

The reappearance of the despised former dictator will likely inflame political tensions after the deadliest week in the country's modern history. More than 1,000 people have reportedly been killed since last Wednesday, and at least 62 in the last 24 hours.

On Monday, security forces say 25 policeman were killed execution style by suspected Islamic militants in Egypt's volatile Sinai Peninsula. The militants reportedly ambushed two vehicles carrying off-duty policeman and shot them in broad daylight.

Hours later, in the northern Sinai city of el-Arish, suspected Islamic militants shot dead another policeman guard outside of a bank.