The bail conditions include surrendering his passport, furnishing a bond of Rs100,000, a pledge to stay away from witnesses in the case and to keep away from the media.
This is the third time Dileep approached the high court for bail. He had also sought bail earlier twice from the trial court.
The court order to free him on bail was brought to the Aluva sub-jail, where Dileep spent 85 days, by his brother.
The high court rejected the prosecution objections that he would influence witnesses and destroy evidence.
Lawyers for the actor argued that the investigation was practically complete and his continued detention was delaying the shooting and release of many films under production.
The court also felt he had no antecedents of criminal activities and had no case of threatening or influencing any witnesses. The prosecution submitted that the mobile phone used for recording the sexual assault was yet to be recovered.
Police say he masterminded the abduction and sexual assault of the 31-year-old actress whom he suspected had a role in the breakup of his marriage with another co-star, Manju Warrier.
In stark contrast to being hooted by angry crowds who had gathered to see Dileep following his arrest on July 10, hundreds of fans gathered to cheer the star yesterday. His fans, including women, began collecting soon after he was granted bail by the high court around 2pm. They were seen distributing sweets and raising slogans in his favour.
Dileep was arrested for his alleged involvement in the conspiracy behind the kidnapping of a popular actress in February this year.
Dressed in a white shirt and a fully grown beard, Dileep stood on the running board of the car and waved to his fans, and also stood with folded hands as the car drove away to his home where his mother, actress wife Kavya Madhavan, his daughter and close relatives were waiting to receive him.
Police were present in large numbers in the jail and also at the two homes of the actor near here.
Ernakulam rural Superintendent of Police A V George, who was one of the key officials in the probe team, told reporters that the charge-sheet in the case would be filed soon.
The arguments on the bail plea got over last Friday.
His release on bail came days after his latest film Ramaleela hit the screens. The movie is running to packed houses all over the state and elsewhere, and industry sources say it could be the highest grosser ever.
Actor Mahesh, who had been defending Dileep all through, expressed happiness.
“Every time a bail plea was moved, we hoped against hope that he would get bail. Finally, the prayers of his fans have been answered,” he said. The abduction of the popular actress took place in February when she was on way from Thrissur to Kochi.
She was taken around in her car and allegedly molested for about two hours before being dumped near an actor-director’s home.
The key accused - Pulsar Suni and his accomplices involved in the actual abduction - were arrested a week later. After detailed questioning, police unearthed a conspiracy angle in the abduction and arrested Dileep.
The police could not gather substantial evidence to link Suni to Dileep except the presence of the two under the same mobile tower location four times between 2013 and 2016.
Police had also questioned Kavya Madhavan and actor-director Nadirsha, his close friend from student days.
The Association of Malayalam Movie Artists (AMMA) has since expelled him, while many veterans, including Adoor Gopalakrishnan and Sreenivasan, came to his defence saying they believed he was innocent.