Singh, 69, was released from Kot Lakhpat Jail this morning, a senior official of the prison department of Punjab province said.
Policemen escorted Singh as he was taken to the Wagah land border crossing in a van to be handed over to Indian authorities, the official told PTI.
Footage on television showed a police van carrying Singh leaving the jail.
Indian officials said a team present at Wagah to receive over 300 fishermen being repatriated today would take care of formalities for Singh's release.
Awais Sheikh, the counsel for Singh, told the media yesterday that the Indian national was arrested by Pakistani police on charges of spying during the regime of military ruler Zia-ul-Haq.
He has spent at least 27 years in Pakistani jails.
Singh was given the death sentence under the Pakistan Army Act in 1985.
The death sentence was commuted to life imprisonment in 1989 by then President Ghulam Ishaq Khan.
Sources said Singh had held meetings with other prisoners in Kot Lakhpat Jail yesterday to bid them farewell.
He requested the authorities to serve him ‘sewai' to celebrate his impending release.
Hours after reports emerged on Tuesday that Pakistan was to free Indian death row prisoner Sarabjit Singh, the presidential spokesman clarified that authorities had actually ordered the release of Surjeet Singh.
After he emerged from the jail, Surjeet Singh said he was looking forward to meeting his family.
“During my imprisonment I often remembered my family and children. Today I am very happy. I will go to the Golden Temple to pray and hug my children,” he told eporters.