Najib, who is serving a 12-year jail term, will be released in August 2028 and fines imposed on him reduced to 50 million ringgit ($10.59 million) from 210 million ringgit, the board's secretariat said in a statement.
The board, chaired by Malaysia's king, did not give a reason for halving Najib's sentence in its statement on Friday.
Najib was convicted for graft linked to state fund 1Malaysia Development Berhad (1MDB), from which U.S. and Malaysian investigators estimate $4.5 billion was stolen and more than $1 billion channeled to accounts linked to the former premier.
He applied for a royal pardon in August 2022 shortly after his conviction and his sentence was upheld by Malaysia's highest court, making him the first premier in the country's history to be jailed.
Najib has consistently denied wrongdoing, saying he was misled by fugitive financier Jho Low and other 1MDB officials over the source of the funds and that he believed they were donations from the Saudi royal family.
He remains on trial in several other cases linked to corruption at 1MDB.
The pardons board said if Najib failed to pay the fine given, an additional year would be imposed on his jail term.
Malaysia's king plays a largely ceremonial role but can pardon convicted people among discretionary powers granted by the federal constitution.
The pardons board, which advises the king, includes the attorney-general and government officials.
($1 = 4.7220 ringgit)
