Raymond Allen Davis has been in jail since Jan. 27, seriously straining ties between Pakistan and the United States.
Punjab Law Minister Rana Sanaullah says Davis was charged with murder on Wednesday but was then pardoned by the families of the victims in exchange for compensation payment.
Chaudhry Mushtaq, superintendent at Kot Lakhpat jail, says Davis had left the jail in the company of U.S. consulate officials.
U.S. officials were not available for comment.
