Russian opposition activist Alexei Navalny, who was sentenced to five years in prison on July 18, was released from custody with order not to leave Moscow until his prison sentence comes into effect, Navalny's lawyer Sergei Kobelev said.

"The order will be valid on the territory of Moscow. Alexei Navalny will be required to stay there," Kobelev told Interfax.

The defense team will go ahead with its plans to appeal Navalny's conviction despite the Kirov Regional Court's decision to release the opposition activist from custody, the lawyer said.

"Restrictions and a prison sentence are totally different things. We will certainly lodge an appeal because we view his conviction as illegal and unfounded," Kobelev said.

Alexei Navalny says this is a unique decision of the judiciary.

"What is going on now is a unique phenomenon for the Russian judiciary," Navalny told reporters in the courtroom.

"Actually, I am somewhat embarrassed because no one else but prosecutors covering up for illegal casinos and I have been released from custody at the request of prosecutors before," Navalny said.

He thanked everyone who helped him gain his release from custody and his lawyers.

"This is a strange moment: everyone was sad and everyone is happy now. It may happen again later. But for now we have a couple of spare months," Navalny said.

The first thing Navalny did after he had been permitted to leave the prisoner dock was rush to his wife and hold her in his arms while photographers were taking pictures.

Chief of the Navalny election campaign staff Leonid Volkov told Interfax earlier that the opposition activist would run for the office of mayor in Moscow because the Kirov Regional Court upheld the prosecutor's appeal against his arrest.

Navalny has said he will make a final decision regarding his further participation in the Moscow mayoral race after he returns to Moscow and consults with his election campaign coordinators.

The opposition activist said that he had two options - "it is either a boycott of the elections or participation in them."

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