Lord Mandelson has been released on bail, the Metropolitan Police says, hours after his arrest on Monday on suspicion of misconduct in public office.

The force said a 72-year-old-man was released pending further investigation. The BBC saw Lord Mandelson returning to his London home at 02:00 GMT.

Lord Mandelson was arrested at an address in Camden, north London, on Monday and taken to Wandsworth police station for interview.

The force launched an investigation earlier this month over allegations that, while he was serving as a government minister, Lord Mandelson had passed on market-sensitive government information to the late convicted paedophile Jeffrey Epstein.

The arrest on Monday followed search warrants at two addresses in Wiltshire and Camden, the police statement added.

Lord Mandelson has not publicly commented in recent weeks on the Epstein files, but the BBC understands his position is he has not acted in any way criminally and that he was not motivated by financial gain.

Lord Mandelson became the British ambassador to the US in February 2025 but was sacked in September after Downing Street said new information about the depth of his relationship with Epstein had emerged.

The government has said it expects to release the first documents relating to Lord Mandelson's appointment in "early March".

Education Secretary Bridget Phillipson told BBC Breakfast that the government's "intention is to disclose documents but we have to tread with some care in making sure that any documents we release don't jeopardise an ongoing police investigation".

"There is a live investigation and when that happens it would be totally irresponsible to do anything that might put at risk their important work, but yes we are committed to transparency around all of this," she added.

On Monday afternoon, Lord Mandelson was seen being led away from his London home by plain clothes officers who put him in the back of an unmarked car.

The BBC understands his arrest was carried out by officers from the Met's central specialist crime division.

Consultations between the police and the Crown Prosecution Service are ongoing.

The allegations against Lord Mandelson surfaced after the US Department of Justice released a tranche of documents last month, including emails between him and Epstein.

An email from 2009 appears to show that Lord Mandelson passed on an assessment by an adviser to the then prime minister Gordon Brown about policy measures, including an "asset sales plan".

He also appeared to discuss a tax on bankers' bonuses and confirm an imminent bailout package for the Euro on the day before it was announced in 2010.

Responding to Lord Mandelson's arrest, the family of the late Virginia Giuffre, who accused Andrew Mountbatten-Windsor of sexual abuse, said they "commend the British authorities for taking meaningful action and treating the Epstein files with the urgency they demand". Andrew has consistently denied any wrongdoing in his associations with Epstein.

In a statement, Sky and Amanda Roberts said: "The contrast with the continued inaction in the United States is undeniable. Survivors deserve transparency, swift investigation, and real justice, no matter who is implicated."

BBC News understands the government will continue talking to police about which documents can be released, after it was previously suggested an arrest could have implications for that process.

The government still wants to be able to publish documents, which it hopes will back up Prime Minister Sir Keir Starmer's claim that Lord Mandelson had "lied" during his vetting process.

Conservative leader Kemi Badenoch said Lord Mandelson's arrest was "the defining moment of Sir Keir's premiership".

Badenoch, who said the prime minister was "weak", added: "Watching the man who he appointed to the highest position in our diplomatic service getting arrested by police is an image which I think is going to stay with us for many, many years to come."

Lord Mandelson has been urged by US politicians to answer questions as part of a Congress investigation into Epstein.

He began working for Labour in the 1980s, playing a key role in the New Labour movement and Sir Tony Blair's landslide election victory in 1997.