China's actions in the South China Sea sparked protests in Vietnam
In a surprise move, China has decided to free 25 Vietnamese fishermen arrested months ago for "violating Chinese territorial waters".
They were held off the Paracel Islands, which are claimed by both countries.
Until recently, the Chinese authorities were demanding thousands of dollars for their release.
But the Vietnamese government requested the fishermen be returned unconditionally, saying they had been operating within Vietnam's territory.
Vietnam foreign ministry spokesman Le Dung said the Vietnamese embassy in Beijing had been officially informed about the release of 25 fishermen, from central Quang Ngai province.
"All the fishermen were freed and on the way back home. It is expected that they'd arrive in the next few days," Mr Dung said.
Among them are 12 fishermen arrested by the Chinese fishing patrol on 16 June near the Paracel islands.
Another 13 were detained on 1 August while seeking shelter from an approaching typhoon, also near the Paracels.
Vietnam and China have been involved in a long territorial dispute over the islands, as well as over the Spratly islands located further south.
China took the Paracels by force in 1974 after a bloody battle in which 50 soldiers from the then South Vietnamese Saigon government were killed.
But Vietnamese fishing boats continue to operate near the islands in what they call their traditional fishing fields.
This year Beijing has toughened its three-month fishing ban in the South China Sea, leading to attacks on Vietnamese boats and arrests of fishermen.
Most of them were quickly released but some were detained while the authorities tried to extract payment from the Vietnamese.
Hanoi 'under pressure'
The detention of 12 Quang Ngai fishermen since June has provoked a tremendous public outcry in Vietnam.
There have been calls on the government to stand its ground and not pay Chinese officials, as this could be seen as a recognition of China's rights in the disputed area.
Hanoi officials have also been under increasing pressure to show that they can defend Vietnamese people.
The fishermen's release could bring a huge sigh of relief, but the Vietnamese government has yet to work with China on some related "outstanding issues", according to Mr Dung.
It seems problems remain far from being resolved.