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The transfer is scheduled to be completed by around midday.
Israeli officials said 85 per cent of the prisoners being released were from the president's Fatah faction.
The others are from smaller groups such as the Popular Front for the Liberation of Palestine [PFLP].
Among those to be released is Abdel Rahim Malouh, second-in-command of the PFLP, which carried out the assassination of Rehavam Zeevi, an Israeli cabinet minister, in 2001.
Possible mediator
None of the prisoners being freed on Friday was directly involved in attacks on Israelis, according to Israeli officials.

Malouh, 61, was arrested in 2003 and is said to be ill.

A member of the Palestine Liberation Organisation's executive committee, he is considered close to Abbas and could serve as a mediator with Hamas.

Israel continues to hold about 10,500 Palestinian prisoners.