The city Department of Correction said in a statement at 5.15pm (New York time) that he was no longer on Rikers Island.
He was released into the custody of the security company that will be monitoring his house arrest.
Strauss-Kahn will be housed in lower Manhattan after his initial arrangement hit a snag.
Prosecutors say objections were made from within the apartment building where he was initially to stay.
Armed guards will watch over him and he will also be monitored electronically.
Lawyer William W Taylor has called the bail decision “a great relief for the family” and said Strauss-Kahn’s mindset was “much better now than before we started.”
The 62-year-old Strauss-Kahn had been in jail since Sunday after he was accused of trying to rape a maid at a Manhattan hotel.
He resigned his post at the IMF on Wednesday.
The ex-IMF head is accused of attacking a 32-year-old housekeeper in his $3,000-a-night hotel suite.
The West African immigrant told police he chased her down a hallway in the suite, forced her to perform oral sex and tried to remove her stockings.
Thursday’s bail decision came less than a day after Strauss-Kahn resigned as managing director of the IMF.
In his resignation letter, he denied the allegations against him but said he would quit in order to “protect this institution which I have served with honour and devotion” and to “devote all my strength, all my time and all my energy to proving my innocence.”
Prosecutors had argued against his release, citing the violent nature of the alleged offences and saying his wealth and connections would make it easy for him to flee.
At his arraignment last Monday, a prosecutor suggested that if Strauss-Kahn were released and ran, he could end up “just like Roman Polanski,” whom the Swiss government declined to extradite last year in the child sex case in the US in which he had jumped bail decades ago.
On Thursday, defence lawyers offered a notorious example of their own: Madoff, the fraudulent financier who stole billions of dollars from investors.
Before Madoff pleaded guilty in the federal case and was sentenced to 150 years in prison in 2009, he was freed on $10m bail, under house arrest and private guard provided by the same firm Strauss-Kahn’s lawyers proposed to monitor him.
Taylor cited Madoff as he noted in court that “there have been other high-profile cases where (defendants) have been released.” He called the proposed arrangement “the most restrictive possible conditions.”
Judge Obus said the conditions played a major role in his decision to allow bail, but he warned Strauss-Kahn he might reconsider “if there is the slightest problem with your compliance.”