Libya has freed an Israeli photographer held by its security services for five months, as part of a secret Austrian-mediated deal involving aid for the blockaded Gaza Strip, an Israeli official said on Monday.

Israel Radio said Rafael Hadad was detained as a suspected spy in March after travelling to Libya, which is technically at war with Israel, on a Tunisian passport -- his second travel document. But the Israeli official denied any espionage link.

Hadad, 34, flew to Vienna on Sunday night and was met by Israeli Foreign Minister Avigdor Lieberman, who had negotiated his release through Martin Schlaff, an Austrian businessman known to the Libyan leadership, the official, speaking on the condition that he was not further identified, told Reuters.

The talks coincided with the sailing last month of a Libyan-chartered ship carrying cargo for Palestinians in Gaza, which is under an Israeli blockade whose efficacy has been the subject of fierce international debate since the navy's bloody May 31 interception of a Turkish-led aid flotilla.

Libya had asked Israel to allow the Moldovan-flagged Amalthea to reach Gaza in exchange for Hadad, the official said.

In a compromise, the Amalthea docked instead in the nearby Egyptian port of El Arish, and Israel agreed that some 20 prefabricated structures in its cargo be admitted to Gaza.

A Schlaff spokesman in Vienna declined comment. Libyan officials in Tripoli were not immediately available for comment. Hadad went to Libya to photograph Jewish heritage sites on behalf of Ohr Shalom, an Israeli organisation for Libyan expatriates, its director Pedatzur Ben-Atia told Israel Radio.

Hadad was born in Tunisia and left with his parents for Israel as a baby, said Haviva Pedaya, a family friend.

Having recently acquired a Tunisian passport, he used it to cross to neighbouring Libya to realise "his dream of living in a Jewish-Arab space and of returning to his earlier roots," Pedaya told Israel's Army Radio.

"You have to understand that when an Israeli goes around there with a camera, and when with a quick glance you can determine that his Tunisian passport is few months old, then some people's suspicions can be raised," she said.

The Israeli official described Hadad as "an innocent civilian" and said that during the negotiations the Libyans had not levelled espionage allegations.