President Mahinda Rajapakse granted freedom to 13 women and 845 men held at 29 prisons across the country to commemorate Vesak, which marks Buddha's birth, enlightenment and death, commissioner Asoka Hapuarachchi said.
"We have released those convicted for minor offences and some who had already served much of their long sentences," Hapuarachchi told AFP.
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Sri Lanka's most high-profile convict, former army chief and the defeated presidential candidate Sarath Fonseka, was not among those released.
Fonseka was arrested two weeks after he lost presidential polls to Rajapakse in January last year and is currently serving a 30-month sentence after a court martial found him guilty of irregularities when he was army chief.
Fonseka lead troops in a military campaign against the Tamil Tiger rebels that ended the island's 37-year separatist war in May 2009. He fell out with Rajapakse over who should take credit for the victory.