Hussein, an Egyptian national held under preventive detention since December 2016, was released from jail Thursday night, the source said, without giving further details.
Al Jazeera — which has run a daily campaign for his liberation — did not immediately confirm his release but had repeatedly said he was being held without formal charges, a trial or conviction.
The Egyptian Observatory for Journalism and Media, a non-governmental organisation, said on its Facebook page that a Cairo criminal court had decided on Monday to free Hussein.
There had been repeated calls for his release, including from human rights watchdog Amnesty International, after a Cairo prosecutor in May 2019 ordered he be freed from jail.
But a week later Egypt’s Supreme State Security Prosecution (SSSP) slapped him with another set of charges and re-ordered his detention.
Hussein’s reported release from jail comes weeks after Egypt said it had agreed to restore ties with Qatar, shortly after the end of a three-year Saudi-led freeze on relations with Doha.
Gulf powerhouse Saudi Arabia, along with the United Arab Emirates, Bahrain and Egypt, cut ties and transport links with Qatar in June 2017, alleging it backed radical Islamist groups and was too close to Riyadh’s rival Iran — claims Doha denied.
Ties were restored following a Gulf regional summit in early January.
Cairo considered Al Jazeera a mouthpiece for Morsi’s outlawed Muslim Brotherhood group, and access to its website has been blocked in Egypt since 2017.
Shortly after Morsi’s ouster, authorities arrested three Al Jazeera journalists, including an Egyptian-Canadian and an Australian, provoking wide international condemnation.
The three journalists, who faced accusations similar to those levelled against Hussein, were freed in 2015.
Australian journalist Peter Greste was deported and the two others were released after receiving pardons from President Abdel Fattah al-Sisi.
Rights groups regularly accuse Sisi’s regime of crushing all forms of dissent and repressing political opponents.
Under his rule, authorities have jailed thousands of Morsi’s Islamist supporters as well as liberal and secular activists, including popular bloggers, actors, singers and journalists.