But there was no indication that any political prisoners would be freed.
The announcement said 3,937 prisoners had been wrongly charged by the former national intelligence bureau, an umbrella organisation of internal security organisations dissolved by the ruling junta last month.
The bureau had been headed by the former prime minister Khin Nyunt, who was ousted a month ago. He has since been accused of corruption.
General Nyunt's removal was believed to have been brought about by hardliners opposed to his relative moderation in dealing with the country's pro-democracy movement, led Aung San Suu Kyi.
Last night's announcement said the releases, from all over the country, had begun yesterday. No other details were provided.
Burma is estimated to be holding more than 1,200 political prisoners, many of them associated with Ms Suu Kyi's National League for Democracy.
Ms Suu Kyi is under house arrest in Rangoon, having been detained in May last year after a clash between her followers and government supporters.
The freedom of political prisoners is demanded by western countries critical of the military regime for its human rights record and failure to hand over power to a democratically elected government. The National League for Democracy won a 1990 general election but the military refused to hand over power.
