The move came as Palestinian president and Fatah leader Mahmoud Abbas met exiled Hamas chief Khaled Meshaal in the Qatari capital Doha, for their first talks since the groups agreed to soon form a unity government and hold elections.
Hamas security sources said the men had been serving sentences for "security offences". Fatah officials say over 40 of their members remain in Gaza jails, while Hamas puts the number at under 20.
The two parties have detained several of each other's members since Hamas won 2006 polls and the two parties fought a bloody civil war in which Hamas seized the Gaza Strip and Fatah remained in power in the Israeli-occupied West Bank.
Issa Nashar, an adviser to Hamas prime minister Ismail Haniyeh, asked Abbas to reciprocate after the announcement.
"President Abbas and the Palestinian Authority should provide a positive atmosphere for reconciliation and stop the practices of (his) security services," he said in a statement.