|Grapel, accused of being an American-Israeli spy, will be exchanged for 25 Egyptians in Israel [Al Jazeera]
Israel's cabinet has approved the release of 25 Egyptian prisoners in exchange for a man with dual US-Israeli nationality who has been held in Egypt on suspicion of espionage since June.
Binyamin Netanyahu's special security cabinet approved the swap on Tuesday afternoon. Egyptian state television previously said the exchange would be carried out on Thursday.
Ilan Grapel was arrested in Cairo on June 12 and has been held without charge since.
Grapel, 27, was suspected by Egyptian officials of spying for Israel during the height of Egypt's uprising that ended Hosni Mubarak's presidency earlier this year.
|Al Jazeera's Cal Perry explains the swap
Israel and his relatives in the US denied Grapel was a spy, saying he worked for a Cairo legal aid project.
The list of prisoners included in the deal will be published so that Israelis would be able to appeal. The swap can then take place 48 hours after the prisoners' names are made public.
"In the framework of Israel and Egyptian efforts and with the help of the United States, Egypt has agreed to release Ilan Grapel. Israel has agreed to release 25 Egyptian prisoners," the statement said.
The statement said there were no "security prisoners" on the list, Israeli shorthand for fighters.
It is assumed that the Egyptians to be freed are mostly smugglers working the porous border between the two countries, sneaking into Israel with contraband and people seeking asylum or work.
Among the 25 Egyptian prisoners to be exchanged will be three teenagers from the Sinai Peninsula, according to Egyptian security officials, speaking on condition of anonymity because no statement was made.
Meanwhile, families of Egyptian prisoners have protested against the exchange, saying that Israeli is releasing only 25 of the 81 prisoners currently in its jails.
According to one local media outlet, Al Masry Alyoum, Khaled Arafat, founder of the Karama Party in Sinai, described the swap as "an insult", while the head of the Egyptian Campaign to Release Egyptian Prisoners has asked for a "million-man demonstration in Tahrir Square to press the government to act to release all Egyptians in prison in Israel".
Al Jazeera's Cal Perry, reporting from Jerusalem, said Grapel is likely to fly directly back to the US upon his release.
Referring to the 1,027 prisoners who were released from Israeli jails last week in exchange for Gilad Shalit, the Israeli soldier captured by Hamas in 2006, our correspondent said "the opportunity has opened for these types of swaps".
Egypt was instrumental in mediating that deal in which Israel freed 455 Palestinian prisoners and is set to free the rest in two months. Some were convicted in deadly attacks against Israelis, including involvement with suicide bombings.
Israeli officials said Grapel's release was not connected to the Palestinian prisoner swap. They were speaking on condition of anonymity because of the sensitivity of the issue.
Grapel moved to Israel - where his grandparents live - as a young man and did his military service during the 2006 war between Israel and Lebanon's Hezbollah, where he was wounded.
Israeli news websites have published what they identified as wartime pictures of Grapel lying in his hospital bed.
Grapel later returned to the US for law school. His father, Daniel Grapel, spoke briefly to Israel's Channel 10 TV from
his home in New York on Monday evening.
"I haven't been officially notified, but I do know that things are happening between the US, Egyptian, and Israeli governments," he said.
Since Mubarak's overthrow, the country's military rulers have often warned against what they call "foreign" attempts to destabilise the country.