Dr Ellie Holman, 44, has been given an apology from the Dubai Government after she was caged for three days with her four-year-old daughter.
She has also been told she is free to leave at any time and the government will pay for her flights home, Mail Online reports.
Dr Holman told the website: "I can't believe this is over. When I got the call from the government telling me they were dropping the case I was in shock.
"I was told to prepare for a long stay in Dubai and a prison sentence. The man on the phone apologised on behalf of the immigration official who put me and Bibi through all of this.
"I feel like a weight is off my chest."
Her release is understood have been ordered after Dubai's ruler Sheikh Mohammed intervened.
She is now hoping to get the first flight home to Sevenoaks in Kent with her children Suri, nine and Noah, eight.
The dentist was detained with her daughter, four, after getting into a dispute with staff over her visa – then quizzed over a free drink she was given on the plane.
She claimed they were dumped in a “baking hot and foul-smelling jail” because consuming alcohol in the strict Arab state is illegal.
But officials said she was detained after she began filming the heated discussion with an immigration official on her phone.
Dr Holman was visiting Dubai with Bibi for a five-day break and it is understood she’s a regular visitor to the city where she is well-known in the Brit expat community.
She is also said to regularly fly over for weeks at a time to carry out beauty procedures such as Botox.
Getting on the wrong side of an immigration official resulted in her spending three days in a cramped detention centre without food, water and air conditioning.
Her ordeal began on July 13 when she stepped off the eight-hour flight to be told her visa was only valid for one visit and she'd have to return to London immediately.
But she says getting back on the long-haul flight with Bibi was "unthinkable" and she got in a tense standoff with the officer at Dubai International Airport.
Dr Holman, originally from Sweden, said he then asked whether she had been drinking and she said she had a free glass of wine given to her by Emirates staff.
The official informed Dr Holman that possession of alcohol is a crime in the UAE, even if it is inside a person’s body, and she was arrested and led away to the cells.
Dr Holman said: “My daughter is a happy, smiley girl, but now she was terrified.
“My little girl had to go to the toilet on the cell floor. I have never heard her cry in the same way as she did in that cell.”
She said the case has cost her £30,000 in legal fees, expenses and missed work, adding: "My practice is closed. All our savings have gone."
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