In comments late on Monday, Aliyu Ayeeni Aliyu, the interior minister, from the former southern rebel Sudan People's Liberation Movement (SPLM), said a presidential decree had been issued which meant that all the women would be free to go.
"[There is] a decree to release all women who have been convicted of making home-brewed alcohol - this is a decree ... made by the president, Omar Hassan al-Bashir," he said.
Sudan's largest women's prison in Omdurman holds between 800 and 1,100 inmates, mostly southerners who fled the north-south civil war to live in slums surrounding the capital, Khartoum.
Making ends meet
Women with as many as eight children, often widowed, make and sell home-brewed alcohol to feed their families.
The beverages are known locally as aragi - a strong spirit made from dates or fruits that tastes like the better-known Middle Eastern arak - and marissa, a brownish drink akin to beer, made from sorghum.
Selling alcohol in Sudan is illegal under the Sharia (Islamic law), which was imposed in 1983 and was one of the catalysts for the war between the mostly Christian and animist south and the Islamist government in Khartoum.
Monday's decision was a show of good faith between the former north-south foes who are now partners in government after signing a peace deal in 2005 to end Africa's longest civil war, which claimed two million lives.
Under the deal, Sharia has been lifted in southern Sudan and a new constitution enshrines religious freedom throughout the country.
But a commission to protect the rights of non-Muslims in Khartoum has yet to be formed, and many are still arrested for making alcohol.