Marte Deborah Dalelv, 24, had been awaiting an appeal hearing of her 16-month sentence handed down this month after a court in the Gulf Arab emirate found her guilty of having sex outside marriage, drinking and making false statements.
"I warmly welcome that Marte Dalelv was pardoned by the ruler of Dubai today. The fight for human rights for all continues," Norway's foreign minister, Espen Barth Eide, said on his Twitter account.
Eide had told reporters Oslo believed the verdict was "completely unacceptable" and said it was contrary to human rights and the basic sense of justice.
Dalelv herself spoke of her relief and delight at the decision. "I am very very happy ... I don't know when I will get to go home, but I'll leave as soon as possible," she told Norwegian state broadcaster NRK. "I am free, finally."
News of the sentence had dominated the front pages in Norway and raised questions about the judicial system in the Gulf state, which attracts large numbers of expatriates and tourists with a Western lifestyle but has little-publicized conservative laws covering sex and alcohol.
Authorities from Dubai's public prosecutor's office had no immediate comment.
Dalelv, who has been staying at a Norwegian Christian center in Dubai pending the appeal, said a male colleague pulled her into his hotel room and raped her after she asked him to help her find her own room when they had a few drinks.
Dalelv said she had chosen to speak about her case in public to warn others of the risks involved in rape cases in the Gulf state.
In the United Arab Emirates, as in some other countries using Islamic law, a rape conviction can require either a confession or the testimony of four adult male witnesses.
(Reporting by Amena Bakr and Sami Aboudi in Dubai; Balazs Koranyi in Oslo Editing by Alison Williams)
