Israeli officials clarified that the gesture will include the release of prisoners who were involved in terror but belong to the moderate camp, and are not members of Hamas or the Islamic Jihad.
The release is part of Israel's effort to encourage the moderate forces and prove that such gestures can only be reached by taking the road of peace.
All the prisoners slated to be freed will be forced to sign a commitment that they would not return to terrorism.
Israeli officials have began preparing the list of names of prisoners designated for release, which will then be handed over to the Ministerial Committee on the Release of Palestinian Prisoners.
Sources at the Prime Minister's Office said that Israel releases Palestinian prisoners every year ahead of the Muslim holiday.