Kristian Vikernes, 40, was detained together with his French wife on Tuesday but investigators found no evidence of a terror plot, the source said.
His wife Marie Cachet was freed on Wednesday.
The pair were brought in from their home in the central French region of Correze over fears Vikernes, who served 16 years in prison in Norway for stabbing a fellow musician to death, was planning an attack.
On Wednesday, Vikernes’s lawyer Julien Freyssinet said that the Norwegian was far from preparing a terror act, describing him as a “survivalist”.
Survivalism is a movement of people who actively prepare for emergencies — by for instance stockpiling food, water and medicine or building protective structures — and sometimes believe a social, political or natural catastrophe is imminent.
He said weapons seized by officers at the couple’s home had been acquired “completely legally and without hiding a thing, as part of a philosophy followed by the couple — that of survivalism.”
The interior ministry said at the time of the arrest that Vikernes was “close to the neo-Nazi movement” and could have been preparing a “major terrorist act”.
However Interior Minister Manuel Valls later conceded no specific target or project had been identified, but authorities had decided to “act before and not afterwards.”