He is being investigated for illicit campaign financing, misappropriation of Libyan public funds and passive corruption.
He was released on Wednesday following two days of questioning over the financing of his 2007 campaign.
Mr Sarkozy, 63, has denied wrongdoing.
He says his Libyan accusers are seeking vengeance for his decision to deploy French warplanes during the uprising which overthrew Gaddafi in 2011.
The centre-right politician failed in his bid to return to power in 2012, losing to socialist François Hollande.
In 2013, France opened an investigation into allegations that Mr Sarkozy’s campaign had benefited from millions of euros of illicit funds from Gaddafi.
One of Mr Sarkozy’s former ministers and a close ally, Brice Hortefeux, was also reportedly questioned by police on Tuesday.
A former aide, Alexandre Djouhri, is fighting extradition to France after being arrested in London in January on suspicion of money laundering as part of the case.
The Swiss businessman has denied the allegation and says the investigation is politically motivated, according to Reuters news agency.
The claims about funding from Gaddafi came from a French-Lebanese businessman, Ziad Takieddine, and some former Gaddafi regime officials.
Mr Sarkozy was detained in 2014 in a separate investigation into alleged campaign funding abuses – the first time this has happened to a French ex-president. (Courtesy BBC)