An Israeli soldier released by Hamas militants who held him five years has reunited with his parents, while tens of thousands of Palestinians in Gaza celebrated Israel's release of hundreds of Palestinian prisoners in exchange for the soldier.

An Israeli military helicopter flew freed sergeant Gilad Shalit to an air base in central Israel, where his parents Noam and Aviva were waiting to see him. He appeared thin and pale as he underwent medical checks before authorities declared him fit enough to return to his home in the northern town of Mitzpeh Hila.

Meanwhile, a huge crowd of Palestinians waving the green flag of Hamas gathered in Gaza City for a ceremony to welcome home about 300 prisoners released from Israeli prisons. Thousands more Palestinians gathered in the West Bank city of Ramallah to greet more than 100 other former detainees. Forty released Palestinians were being exiled to Turkey, Syria and Qatar. Relatives expressed joy at reuniting with the freed prisoners.

After greeting Shalit at the air base, Israeli Prime Minister Benjamin Netanyahu warned that any freed Palestinian who returns to terrorism will be held accountable. Most of the released prisoners were serving life sentences for involvement in deadly attacks on Israelis.

In an interview with Egyptian television after his release, Shalit said he hopes the prisoner exchange deal would lead to peace between the Israelis and Palestinians. He also said he missed his family and friends.

In Ramallah, Palestinian President Mahmoud Abbas praised the freed detainees as freedom fighters in the Palestinian struggle for an independent state and an end to Israeli occupation.

The prisoner exchange deal mediated by Egypt called for Hamas to free Shalit in return for Israel's simultaneous release of 477 Palestinian inmates. Israel is required to free another 550 Palestinian prisoners over a two-month period.

Shalit, now 25 years old, was captured by Palestinian militants in a 2006 cross-border raid from Gaza into southern Israel.