By Jonathan Saul

JERUSALEM, Jan 3 (Reuters) - An Israeli parole board freed an Israeli woman on Wednesday who was sentenced to three years in jail for aiding a wanted Palestinian militant.

Tali Fahima, 30, a fierce critic of Israeli occupation of land Palestinians seek for a state, was sentenced in December 2005 by an Israeli court. By that time she had already been under arrest for more than a year.

Under a plea bargain, Fahima had pleaded guilty to charges of contact with a foreign agent with the intention of harming national security, transferring information to the enemy and disobeying a legal order.

"It decided to free her," a Prisons Authority spokeswoman said, referring to the parole board.

Fahima, formerly a secretary, had already served two-thirds of her sentence and was due for release in November 2007. Fahima moved to the West Bank city of Jenin at the height of a Palestinian uprising and befriended Zakaria al-Zubaidi, a leader of the militant group al-Aqsa Martyrs Brigades and who was wanted by Israel.

Fahima had been a frequent guest at Zubaidi's Jenin house and had told reporters she stayed close to him to act as a human shield to protect him from Israeli assassination.

Zubaidi's second-in-command was killed by Israeli troops in Jenin in 2004.

Fahima once said she had supported the right-wing Likud party, which has long championed Jewish settlement of the occupied West Bank.

She became a critic of Israeli policy following her visits to Jenin.

Under the terms of her release, Fahima is prohibited from contacting anyone Israel considers to be an enemy of the Jewish state and from entering Palestinian areas.

"There is nothing I regret," Fahima told Army Radio. "I will continue with my humanitarian activities (towards Palestinians) inside Israel."

Hearing the news of Fahima's release from her lawyer, Zubaidi told Reuters: "This is a very happy day for me and the people of Jenin."

"Tali Fahima did not have anything to do with our cause and was not a member of al-Aqsa Brigades," he said. "We wish her a happy life and we hope to see her back here."

Prosecutors at the trial had said she translated for Palestinian gunmen a secret military document that outlined Israeli army plans to detain or kill militants.

Under the plea bargain deal they dropped more serious charges, carrying a maximum life term, of aiding the enemy during wartime and supporting a terrorist group.

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