Whisked away: Dr Mohamed Haneef is released from jail (Channel 7)

Haneef lawyers will 'fight to clear name' Indian doctor Mohamed Haneef is enjoying his first day of freedom this morning after more than three weeks of detention in a Brisbane watch-house and jail.

Dr Haneef was released from prison last night after Commonwealth prosecutors abandoned their case against him.

He had been charged with recklessly providing support to a terrorist organisation.

Doctor Haneef was driven swiftly out of Wolston Correctional Centre guarded by Immigration officers and police.

He has been placed under residential detention, which means he can move freely around Brisbane with reporting conditions but cannot go near an airport or leave town.

Dr Haneef's lawyer Peter Russo says he will stay in Brisbane until the Federal Government decides whether to reinstate his visa.

"He is basically a free man," he said.

"The only difficulty is he doesn't have a visa, so he is really regarded as a foreign alien."

Dr Haneef's legal team is now preparing for a Federal Court hearing in 11 days, where they will challenge the Government's decision to cancel his visa.

Decision welcomed

The body representing overseas-trained doctors says it is happy that public scrutiny has meant the truth has come out in Doctor Haneef's case.

Australian Doctors Trained Overseas Association president Andrew Schwartz says he is disgusted at the way the case has been handled.

He says it is too early to say what impact the case will have on overseas-rained doctors coming to Australia.

New South Wales Attorney General John Hatzitergos says the Federal Government needs to move to reassure people that new anti-terrorism laws have not been abused.

"It's unfortunate that these events have occured and that some might question the need for those laws, which in my view are essential for the national security of the country," he said.