Bárcenas has been in prison since June 2013, when he was remanded in custody after an investigating judge ruled he proved a flight risk and could destroy evidence in relation to his involvement in the so-called 'Caso Gürtel' corruption case.
The ex-money man for the PP — a poster boy for corruption in Spain — is charged with money laundering and tax fraud among other crimes as part of an investigation into a group of Spanish businessmen who organized PP events in exchange for kickbacks.
However, the courts have now agreed to his release on bail given he has already spent 19 months on remand, and no longer presents a flight risk.
He has been stripped of his passport and will have to regularly report to authorities.
Public prosecutors are currently seeking 42 and a half years' prison for Bárcenas in relation to the Gurtel Case for crimes including tax fraud and money laundering.
In a separate case, he is also being investigated over claims he administered an illegal party slush fund for the Popular Party, making under-the-table payments to top party officials including Prime Minister Mariano Rajoy. Rajoy has repeatedly denied those claims.
Bárcenas’ lawyer, Javier Gómez de Liaño, is due to deposit the €200,000 bail money on Thursday morning and the former party treasurer could leave Soto del Real prison by Thursday lunchtime, reported Spanish daily, El Mundo.
Under the bill anonymous donations to political parties above €50,000 are banned. The law also calls for fines equivalent to three to four times the amount of money that was illegally donated.
If the donations surpass €500,000 - or just €100,000 if the money came from a foreign body - jail terms ranging from six months to four years could apply.
The main opposition Socialist Party (PSOE) said the reform was "completely insufficient" since those who donate less than €500,000 will not go to jail. It points out that in the "Gurtel" case, in which Bárcenas is embroiled, none of the accused donated more than €500,000.