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Ri is being handed over to immigration officials and transported to Kuala Lumpur international airport, Malaysia's National Police Deputy Inspector-General Noor Rashid Ibrahim told CNN.
The only North Korean arrested in connection with the case, Ri appeared to be wearing a bullet-proof vest when he was escorted out of the building by half a dozen police, some of whom covered their faces with balaclavas and carried automatic weapons.
Police don't have sufficient evidence to charge Ri Jong Chol, Malaysian Attorney General Mohamed Apandi Ali told CNN Thursday. Ali said he'll be deported to North Korea after his release.
Kim, the older half-brother of North Korean leader Kim Jong Un, was killed February 13 before he was supposed to board a flight to the Chinese-controlled territory of Macau.
Ri was the only North Korean to have been detained in the case, but investigators have named four North Korean suspects who are believed to be back in Pyongyang.
North Korea strongly denies responsibility, and its state media blamed Seoul and Washington for "resorting to political chicanery to bring down the social system in the DPRK (Democratic People's Republic of Korea)."
Malaysia bans visa-free travel for North Koreans
The brazen public kiiling has also frayed diplomatic relations between North Korea and Malaysia.
Malaysia's Deputy Prime Minister Ahmad Zahid Hamidi announced Thursday that North Koreans would now need to get a visa to travel to the country starting March 6, according to Bernama, Malaysia's state news agency.
The diplomatic row began when North Korea's ambassador to Malaysia, Kang Chol, said February 17 the country would reject the results of a "forced" autopsy on one of its citizens and demanded the immediate release of the body.
Kang later accused Malaysian officials of officials of conspiring with "hostile forces" during the investigation, eliciting a harsh rebuke from his host country.
"The statement by the ambassador was totally uncalled for, it is considered diplomatically rude on his part," Malaysian Prime Minister Najib Razak said in response. "Malaysia is not the pawn of any country and we will never be the pawn of any country."
VX
It's banned under the Chemical Weapons Convention.
It works by inhibiting an enzyme that regulates muscle function, causing paralysis and suffocation.
It's lethal in doses as small as 10 mg.
"VX is probably the state-of-the-art nerve agent," CNN military analyst Rick Francona said. "It is probably the most lethal of all the nerve agents ever designed."
CNN's Pamela Boykoff reported from Kuala Lumpur, while Joshua Berlinger reported and wrote from Hong Kong. CNN's Ben Westcott contributed to this report