The release of the hostages was confirmed by Sardar Abbas Rind, chief of the administration in the northwestern town of Bannu.
Earlier, officials had said police were negotiating with the Taliban via tribal elders for the captives.
Taliban fighters seized the students' convoy on Monday near the town of Bakka Khel, abducting students and staff from four vehicles of the convoy, made up of about 27 vehicles.
The students from from the military-run Razmak Cadet College in North Waziristan were heading home for the summer holiday.
"Kidnappings and abductions have become a norm for the militants who have been operating in that area," Al Jazeera's Kamal Hyder, reporting from Islamabad, said.
"They use the money to fund their militancy and purchase weapons."
The Razmak Cadet College is an army-run educational institution for civilians, with students who are reportedly aged between 15 and 25 years and were not training for the army, but were following a secular curriculum.
Javed Alam, a vice-principal of the college, said the convoy was carrying that more than 300 students and about 30 staff members and employees of the college when they were stopped.
"Militants started firing in the air to stop the vehicles and then they forcibly drove them to unknown place" he told a local television channel.
The abduction was part of a string of incidents in the tribal belt, some of which the army says is aimed at distracting it from its offensive against Taliban fighters in the Swat valley.
The Pakistani army launched its offensive against Taliban fighters in Swat and surrounding districts a month ago after they violated the terms of a ceasefire.
In recent days it has claimed some success, including re-capturing Mingora, the main city in the Swat valley.
There are several Taliban and al-Qaeda-linked groups based in North and South Waziristan, in loose alliance with the Taliban in Swat.
South Waziristan is also thought to be the base of Baitullah Mehsud, the Pakistani Taliban leader.