The decision came after defense attorney Fareed El-Dib said in a memorandum his client spent two years in provisional detention, the maximum allowed, Ahram Online reported.
The prosecution agreed with El-Dib's argument.
Cairo Criminal Court sources told al-Masry al-Youm Mubarak would remain in custody pending investigations into corruption charges related to misuse of funds allocated for the renovation of presidential palaces.
Prosecutor General Talaat Abdallah last week ordered 15 more days detainment for the former president while prosecutors investigate charges he seized public money for personal use, MENA reported.
Abdallah said the new charges allowed authorities to keep Mubarak in custody even though the two-year period is up.
Mubarak was arrested April 12, 2011. In June, he was sentenced to life in prison for failing to protect peaceful protesters during the 18-day uprising in 2011 that led to his ouster, but was granted a retrial in January because of procedural irregularities in the first trial.
The judge overseeing the retrial recused himself Saturday, referring the case to the Cairo Appeal Court. The new date of the retrial hasn't been set.
Also facing retrial for their role in the deaths of protesters during the revolution are former interior minister Habib El-Adly and six of his aides.
Mubarak's sons, Alaa and Gamal Mubarak, were in court Monday for a ruling on their release pending the review of a case in which they are charged with financial corruption.