Muntadhar Zaidi's family had gathered shortly after dawn outside an Iraqi army base in central Baghdad where he was expected to be released from prison.
After waiting more than five hours, his brother Dargham said he had received a phone call from Zaidi telling him he would not be released until Tuesday because of the delays.
Dargham was in tears as he spoke on the phone to his brother. Other family members cried when he broke the news to them.
Dargham and Uday, Zaidi's other brother, said they would stage a sit-in outside the base Tuesday until he is released, and they called for other Iraqis to join them.
"We will set up a tent right here on this spot where we will stage a sit-in and we will cut off the road too until they release him," said Uday.
Zaidi's act of protest last December made the little-known TV reporter an instant hero across the Arab and Muslim worlds where Bush is extremely unpopular.
In the meantime, the shoe-throwing protest at the former US president made Zaidi a hero across the Arab world, but it also caused embarrassment to Iraq's prime minister, Nouri al-Maliki, who was standing next to Bush at the time.
Maliki's government is believed to be keen to avoid Zaidi being lionised after his release. Zaidi had been planning to give a press conference under the eyes of the world's media before being flown out of Iraq.
However the release is handled, Zaidi has won the adulation of millions, who believe his act of defiance did what their leaders had been too cowed to do.
Pictures of the president ducking have been etched on walls across Baghdad, made into T-shirts in Egypt, and incorporated into children's games in Turkey.
It was also reported, Zaidi, who lives in Baghdad, has worked for al-Baghdadia for three years.
A senior official at the channel said his salary had continued to be paid during his prison term and that a home had been bought for him in the capital.