The Pakistani government says it has now released some 3,400 people jailed under emergency rule.
Gen Musharraf has been under pressure to lift emergency rule
The release of political opponents has been a key demand of opposition parties who are threatening to boycott parliamentary elections in January.
A number of leading political figures are still being held.
President Pervez Musharraf imposed emergency rule on 3 November, saying the measure was needed to rein in the judiciary and fight extremists.
Senior members of the Pakistan People's Party led by Benazir Bhutto are meeting in Karachi on Tuesday to decide their next step in the current crisis.
Meanwhile, more than 100 journalists have been arrested, most of them in Pakistan's biggest city, Karachi.
They were protesting at the state of emergency and the clampdown on the media.
Another 2,000 activists will be released shortly, an official told the BBC, but that will not necessarily include anyone facing criminal charges, such as the former cricketer and opposition leader Imran Khan.
The BBC's Chris Morris in Islamabad says that Gen Musharraf appears to be responding to domestic and international pressure.
The state of emergency remains in place and the constitution suspended.
That means, in theory, that anyone being released now could be detained again at any time.
In a series of interviews over the last few days, Gen Musharraf has insisted that he will not allow anyone to promote "agitation" in the run-up to parliamentary elections in January.
But our correspondent says that what President Musharraf views as agitation others may see as robust electioneering.
There will be no constitutional guarantees in place, and Pakistan's most popular private TV news channel remains off the air.
So the release of thousands of people who have been protesting against Gen Musharraf is likely to be welcomed both by his critics at home and his friends abroad.
Our correspondent says demands for lifting the state of emergency will not go away and so far there has been no sign that Gen Musharraf is prepared to take that step.
Meanwhile the chief election commissioner has confirmed that parliamentary and provincial assembly elections will be held on 8 January, 2008.