The man named by Israel, Qaid Farhan al-Qadi, worked as a guard at a factory on a kibbutz when the terrorist-stamped Hamas carried out attacks against Israel on October 7.
al-Qadi (transcribed as Elkadi in Israeli media) comes from a Bedouin community, where a majority of the residents are Muslims.
The IDF says that the rescue was carried out during "a complex operation in southern Gaza".
Later on Tuesday, more details about the event emerged. al-Qadi is said to have hidden in a tunnel when Israeli soldiers approached in reconnaissance after Hamas members and potential hostages. Those who held al-Qadi captive are said to have fled when they heard the soldiers searching the tunnel.
Exact location descriptions have not been made public, as such information falls under Israeli censorship rules.
The rescued man was reported to be in good health and was examined at the hospital on Tuesday.
"A miracle"
al-Qadi has two wives and is the father of eleven children. The Israeli media company Keshet 12 showed how his family made their way to the hospital after they found out that he was alive.
The organization working to free the hostages said that al-Qadi's opportunity to return home "is nothing but a miracle; he has endured 326 days in captivity".
But the organization Hostages Families Forum stated simultaneously in a statement that the only way to free a majority of the hostages is through an agreement.
The organization receives some support from IDF spokesperson Daniel Hagari, who said that they are gathering more intelligence information for new operations – but that it is not enough:
"We cannot bring everyone home solely through rescue operations."
Last week, the Israeli military was able to return the remains of six hostages in southern Gaza.
Israel estimates that 104 of the 251 hostages taken by Hamas on October 7 are still in Gaza, including 34 confirmed dead by the IDF.
Eight freed
So far, the IDF has managed to free eight hostages in military operations; two of which resulted in the deaths of many Palestinians. About 1,150 people are estimated to have been killed in the terrorist attack, mostly civilians.
Since Israel declared war on Hamas after the attack, more than 40,000 people in Gaza have been killed in Israeli attacks, according to health authorities in the Hamas-controlled strip.