Thomas Curley, president and chief executive of the AP, said he had just learned of Mr Hussein's release.
"After two years and four days of captivity, Bilal Hussein is back with the AP," he told a gathering of US newspaper editors and executives in Washington.
'No acquittal'
The US announced earlier that Mr Hussein was no longer a security threat.
"After the action by the Iraqi judicial committees, we reviewed the circumstances of Hussein's detention and determined that he no longer presents an imperative threat to security," Maj Gen Douglas Stone said in a statement.
However, the US military said the photographer was not being cleared of any wrongdoing.
"A finding that amnesty applies is not an acquittal, but a determination that the alleged misconduct, whether proved or not, will be excused by the government of Iraq," said the statement.
Mr Hussein - a member of AP's Pulitzer prize-winning team in 2005 - was held in Ramadi, the capital of Anbar, in April of the following year when the Sunni insurgency was at its height in the region.
The US military statement accused him of possessing equipment for making bombs and working with insurgents to photograph explosions targeted at security forces.
AP says Mr Hussein was taken into custody after sheltering strangers in his home following an explosion near his home in Falluja.
The US military decision comes a week after Iraqi judges dismissed the accusations and ordered Mr Hussein's release under an amnesty law passed in February.
Human Rights Watch had also appealed for his release.
The US has previously said it has a UN Security Council mandate to detain anyone believed to be a security risk, notwithstanding Iraqi judicial orders.
Reuters news agency says some of its journalists have also been detained in Iraq by the US military for months before being freed without charge.