British and Iranian officials are resuming talks on the release of the eight UK navy personnel held in Iran since Monday.
The UK has expressed concern over the use of blindfolds
British diplomats say the Iranians have agreed to free the men but details of their release need to be ironed out.
The men were seized in the Shatt al-Arab waterway.
The BBC's Jim Muir says the men have been given clean clothes and told the results of the recent Euro 2004 football matches.
According to UK officials, the six Royal Marines and two sailors were training the Iraqi river patrol service when they were seized.
They may have mistakenly strayed over the maritime border.
The men appeared on Iranian TV wearing blindfolds and admitted entering Iranian waters illegally.
British diplomats were able to visit the men on Wednesday. They said they were all fit and well and in pretty good spirits. They said the men were not being kept blindfolded.
THE SHATT AL-ARAB
120 miles of tidal waterway
Formed by Tigris and Euphrates rivers
Subject to 1639 Persian-Ottoman treaty
Southern stretch forms border between Iraq and Iran
River is vital trade route for both countries
Control of river one of disputes causing Iran-Iraq war in 1980
However, the diplomats were unable to say when the talks, which are taking place at Bandar-e-Ma'shur in south-west Iran, would conclude.
There are several tricky issues still to be negotiated, including the issue of whether the three boats, arms and sophisticated equipment the men had with them when they were seized should also be handed back.
The logistics of their release and how they should leave the country could also entail some snags and hard bargaining.
There have been differing reports on the timing of the men's release.
The Iranian television station al-Alam said on Thursday that the men had left the Gulf area for the Iranian capital Tehran.
There have also been reports that the men have boarded a plane with British diplomats.
However, the UK Foreign Office could not confirm the reports.
On Wednesday, Iranian TV announced that the men had already been released, although later reports said negotiations were still going on.
Iran's armed forces spokesman Ali Reza Afshar said the army was satisfied that the arms and equipment carried in the three British boats had been for use on patrols.
However, Iranian officials later said the naval launches and the arms and equipment that the British servicemen had with them would not be included in the release.
The servicemen are thought to come from two Scotland-based units - Arbroath-based 45 Commando and the Fleet Standby Rifle Troop from Faslane on the Clyde - and from the 539 Assault Squadron in Plymouth, south-west England.
The arrests came at a time of strained relations between the UK and Iran.
Iranian hardliners have staged a series of angry demonstrations outside the British embassy in Tehran in recent weeks to protest at the occupation of Iraq.
Britain has also been strongly criticised too for its role in helping draft a tough resolution on Iran at the International Atomic Energy Agency in Vienna last week.