Mr Ai - a vocal government critic - was bailed after the Chinese authorities said he had confessed to tax evasion. Mr Ai said he was unable to comment.
The 54-year-old's arrest in April sparked an international outcry.
Mr Ai was held for 80 days at a secret detention centre with no access to a lawyer or contact with his family.
Western governments had demanded Mr Ai's release and that of many other activists who have been rounded up by China's authorities in recent months, in what is the most serious crackdown on dissidents in China in many years.Silenced?
Speaking on Thursday, foreign ministry spokesman Hong Lei outlined the terms of Mr Ai's bail, which are valid for 12 months.
"During this period, Ai Weiwei is still under investigation. Without permission... he is not allowed to leave his area of residence," Mr Hong told reporters. (read more)