Hagan, 69, who has been on work release since March 1992, was released at 11 a.m. from the Lincoln Correctional Center, which is on Malcolm X Boulevard in New York, CNN reported.
Hagan was sentenced in 1966 to 20 years to life in prison and had gone before the parole board 15 times since 1984. Two other men convicted in the killing, whom Hagan said were innocent, were released in the 1980s.
"I can't really describe my remiss and my remorse for my actions," Hagan has said.
Malcolm, 39, was shot to death Feb. 21, 1965, after abandoning the Nation of Islam for orthodox Islam. The split spawned a feud with Nation of Islam founder Elijah Muhammad. The Nation of Islam, however, has denied any role in the assassination.
Hagan, then 22 and known as Talmadge X Hayer, was a radical member of the Nation of Islam, CNN said. He was shot in the leg during the assassination as he tried to escape and was beaten by the crowd. He told the parole board at the time, he was incensed about remarks Malcolm X made about Muhammad.
"I can't say that anyone in the Nation of Islam gave us the idea or instructed us to do it. We did this ourselves for the most part, yes," Hagan said at his parole hearing.