Shariy was arrested on Wednesday near the coastal city of Tarragona under an international arrest warrant issued by Ukraine, according to Spain's National Court.
Court documents said Shariy is accused of "high treason and incitement of hatred".
Citing the "circumstances of the case" and Shariy's connections to Spain, the judge declined to keep him in custody.
Instead Shariy was ordered to surrender his passport, report regularly to authorities and remain in Spain, where he has reportedly lived since 2019.
The court said the measures would remain in place for 40 days in order to allow Ukraine to formally request Shariy's extradition.
His arrest in Spain was announced by Ukraine's security services on Thursday, who said there was reason to believe Shariy "was acting on behalf of foreign entities".
Shariy, the founder of a political party considered by many in Ukraine to be pro-Russian, has been a vocal critic of Ukraine's government and President Volodymyr Zelenskiy.
As recently as Tuesday he tweeted that he had been warned that Ukrainian intelligence was trying to track him down.
In 2019, he registered a Ukrainian political party, called The Party of Shariy, which won a few dozen seats in several regional assemblies.
Ukraine's National Security Council suspended the party, along with several others linked to Russia, in March following Russia's invasion.
Ukrainian media reported that a member of Shariy's party said in February, prior to the start of Russia's invasion of Ukraine, that Shariy had been granted asylum in the European Union.
with reporting from Reuters
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