Nazanin Zaghari-Ratcliffe, the British-Iranian woman jailed in Iran on spying charges, has had her ankle tag removed at the end of her five-year sentence.
But her husband Richard Ratcliffe has been told a new court case against her is scheduled for next Sunday.
The charity worker had been under house arrest in Tehran since being moved from jail last March. She has always denied the charges against her.
The foreign secretary said she should be allowed to return to the UK.
Dominic Raab said in a statement: “We welcome the removal of Nazanin Zaghari-Ratcliffe’s ankle tag, but Iran continues to put her and her family through a cruel and an intolerable ordeal.
“She must be released permanently so she can return to her family in the UK. We will continue to do all we can to achieve this.
“We have relayed to the Iranian authorities in the strongest possible terms that her continued confinement is unacceptable.”
Mr Ratcliffe said his wife had gone to see her grandmother and was “determined to enjoy the afternoon and not think about what it all means”.
“I don’t think we expected something clean but how muddy this is I’m not quite sure yet,” he told the BBC.
He also told the PA news agency she was “genuinely happy” after having her ankle tag removed.
“I’m a bit more guarded – it feels to me like they have made one blockage just as they have removed another, and we very clearly remain in the middle of this government game of chess,” he said.
Mrs Zaghari-Ratcliffe, 42, had been out of prison since last spring due to the coronavirus pandemic but had been confined to her parent’s house. Her sentence was due to end on Sunday.
She was arrested in April 2016 while travelling to visit her parents in Iran with her young British-born daughter, Gabriella, who is now six years old.
The dual national was sentenced to five years in prison over allegations of plotting to overthrow the Iranian government, which she denies.
She has not yet had her British passport returned to her, according to Tulip Siddiq, the Labour MP for the Hampstead and Kilburn constituency in London where her family live.
Ms Siddiq told the BBC: “She does have to go back to court and we don’t know what awaits her there.
“Nazanin is quite worried because there was talk of another case being put against her which may of course mean another sentence, and we don’t know how long for.”
However Ms Siddiq said the removal of her ankle tag meant she could visit her elderly grandmother “which is the thing she mentions every time I speak to her”.
“So on one hand they are celebrating that she has some elements of freedom in terms of not having the tracker anymore, but we just don’t know what’s going to happen in the court case,” she added.
“I know her daughter has been counting down the days on her calendar at home for her mother to return.”
Jeremy Hunt, who served as foreign secretary while Mrs Zaghari-Ratcliffe was in jail, said Iran’s actions were “totally and utterly inhumane”.
“At the centre of this is an innocent woman, her husband and her daughter,” he told the BBC, adding that Mrs Zaghari-Ratcliffe should be allowed to return home to the UK.
Shadow foreign secretary Lisa Nandy said there had been “an increasing use of this totally unacceptable hostage diplomacy from Iran”.
“The government is right to say it is not acceptable for individuals like Nazanin Zaghari-Ratcliffe to be used as a bargaining chip in this wider political game,” she told the BBC.
Antonio Zappulla, chief executive of the Thomson Reuters Foundation, Mrs Zaghari-Ratcliffe’s employer at the time of her arrest, said he had spoken to her on Sunday and she was “ecstatic” to be able to have a coffee in a café.
“Nazanin should be allowed her permanent liberty and to walk away from this appalling affront to justice; instead, for all intents and purposes, she is still held hostage,” he said.
Meanwhile, Kate Allen, director at Amnesty International UK, said the news that Mrs Zaghari-Ratcliffe’s ankle tag had been removed was “bittersweet” and “yet another example of the calculated cruelty of the Iranian authorities”.
“Nazanin was convicted after a deeply unfair trial the first time around and this spurious new charge and possible trial is clearly designed to delay her release and exert yet more pressure on Nazanin and her family,” she said.
“This won’t be over until Nazanin has her passport and is on a flight heading home to the UK,” she added, urging the government to take “serious diplomatic action”.
Mrs Zaghari-Ratcliffe’s sentence has included eight months of solitary confinement, blindfolded interrogations and hunger strikes to press for medical treatment.
Prior to her arrest, she lived in London with her husband and child.
In November, she was taken to court on fresh charges of spreading propaganda against the Iranian regime.
Her family and the UK government have always maintained her innocence and she has been given diplomatic protection by the Foreign Office – meaning the case is treated as a formal, legal dispute between Britain and Iran.
Mr Ratcliffe believes his wife and other dual nationals are being held hostage because Iran wants the UK to pay a decades-old debt over an arms deal that was never fulfilled.