The Boulogne prosecutor said Gen Christian Piquemal, who is in his 70s,  was suffering from poor health. He was released on bail, according to reports.
Gen Piquemal is accused of helping to organise the rally on Saturday.
Police had told supporters of the anti-Islamic group Pegida to disperse, and then fired tear gas to break them up.
They were taking part in a Europe-wide demonstration against what they say is the Islamisation of the continent.
The northern port city of Calais is home to thousands of asylum seekers who are living in a camp known as the "Jungle" while they try to slip illegally into the UK.
Gen Piquemal was one of several people arrested on Saturday. News of his release on Monday was greeted with cheers by a group of his supporters gathered outside the court in Boulogne. They than sang the French national anthem.
Some reports on French media said Gen Piquemal had been admitted to hospital on Monday morning, but this was not confirmed.
Gen Piquemal, who commanded the elite French Foreign Legion for five years, is accused of playing a "principal role" in organising the illegal demonstration. He could face up to a year in prison and a heavy fine if found guilty.
Gen Piquemal was one of about 150 Pegida supporters who had gathered in Calais chanting slogans such as "We must not let Calais die" and "Calais is part of France".
At the time of his arrest, Gen Piquemal said he was "shocked" that officers had broken up the protest during the singing of the national anthem.
"I expected you to be at attention, singing with us but not one of you opened your mouth," he told them.
French authorities had banned all rallies in Calais "regardless of the organisers".
The court hearing for a former French Foreign Legion commander arrested at a banned anti-Islam rally in Calais has been delayed until 12 May.