Sheikh Ra'ad Salah, the leader of the Islamic Movement's northern branch, was released from jail on Wednesday on probation.
Salah, who was detained in Jerusalem last week, will remain under house arrest for seven days.
The details of his incarceration have been placed under a gag order. Salah, who is known for his hardline stance against Israel, completed a five-month prison term in December for assaulting a policeman.
The incident that led to those charges against Salah occurred in February 2007 at the Temple Mount during an Islamic Movement demonstration against construction work carried out at the Mugrabi Gate. The demonstrators claimed that the work was an effort to destroy Muslim holy sites and the Al-Aqsa Mosque.
The court ruled that Salah spat in the face of a border policeman and told him: "You are racists, killers and you have no honor."
Salah rejected the accusations and argued that he was opposing Israeli aggression. He appealed against the decision and the sentence through his lawyers at the Jerusalem District Court.
The district court rejected the appeal last month but shortened the original sentence from nine months to five months.
Salah had repeated run-ins with Israeli authorities before the current arrest. He was imprisoned previously for funneling money to the Palestinian militant group Hamas.
Arabs are around one-fifth of Israel's population of more than 7.6 million. In recent years, some of the disgruntled members of that sector have slowly migrated to hard-line groups including the Islamic Movement.
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