Earlier, delays in the promised release of prisoners brought threats that further stalling would be met by international sanctions.
"The time for words has passed. We expect deeds," the European High Representative, Carl Bildt, said after the group of countries overseeing the Bosnia peace process met in Moscow on Saturday.
In Sarajevo on Sunday, the commander of Nato ground forces in Bosnia, Lieutenant-General Sir Michael Walker, said he welcomed the release "but cannot consider it to be full compliance until all prisoners are released."
He said the Nato-led implementation force would continue to assist the Red Cross in "their efforts to release all prisoners until this crucial commitment is fulfilled."
Colum Murphy, a spokesman for Mr Bildt, who is overseeing implementation of civilian aspects of the Dayton peace accord, also said the release fell short of the agreement. He said the Bosnian government is still holding 26 prisoners in Tuzla. "Measures to ensure compliance are being considered," Mr Murphy said.
The men released on Saturday night were bused from a Tuzla jail about 30 miles to a checkpoint manned by Swedish soldiers, near Gracanica.
Most were captured in the final weeks of Bosnia's war, last autumn. The few who spoke to reporters said they had been treated correctly in jail. "I hope somebody's waiting for me," said Zeljko Goric, 40.
At the Gracanica bridge, a Red Cross representative said all 109 men they had expected to be released had been freed. He expected further prisoner releases in the coming days.
If the releases do not go through, one measure to ensure compliance would be cuts in financial aid from foreign donors, officials said at the Moscow meeting.
During talks last week in Geneva, leaders of Bosnia, Croatia and Serbia agreed to release remaining POWs by midnight Saturday night. The Nato- led peace force and the Red Cross had urged all the factions to honour their pledge.
In Pale, the Bosnian Serb headquarters near Sarajevo, a senior Serb leader said he was willing to co-operate, as long as the Red Cross guarantees that the Muslims and Croats also release prisoners.
"The moment ICRC announces that the prisoners should be released, we will do that," Momcilo Krajisnik said. "But we cannot allow [ourselves] to be cheated."
Pierre Krahenbohl, the head of the Red Cross mission in Bosnian Serb territory, blamed the delay on technicalities.
Elsewhere in Bosnia, Nato announced US soldiers on Saturday had discovered and shut down four unauthorised police check-points set up by Bosnian Serbs and by the government.