The Palestinian girl's lawyer described her as the "youngest Palestinian" prisoner detained by Israeli forces. Israel's prime minister has noted a "significant decline" in attacks committed by Palestinians.
Israel's prison service on Sunday said a 12-year-old Palestinian girl detained in February had been released.
Dima al-Wawi allegedly confessed to an attempted stabbing attack in a plea bargain with Israeli military prosecutors.
According to court documents, Wawi was discovered outside an Israeli settlement in the occupied West Bank on February 9 while in possession of a knife.
She was sentenced to four and a half months under the plea bargain, although she was released early after an appeal, Wawi's lawyer Tariq Barghouth said.
"She is the youngest Palestinian girl ever imprisoned," said Barghouth in a statement on Facebook.
Wawi's case comes amid a spate of stabbings that have left 28 Israelis and over 200 Palestinians dead, many who were perpetrating the attacks, since October.
"As of February, there were 440 Palestinian children in Israeli military detention," reported the Institute for Middle East Understanding (IMEU), citing the Israel Prison Service.
"Israel has held an average of 204 Palestinian children in custody each month," IMEU added.
Earlier this month, Israeli Prime Minister Benjamin Netanyahu said there has been a "significant decline" in attacks committed by Palestinians against Israelis.
ls/jlw (AFP, AP)