Lissu, who returned to Tanzania in January after spending years in exile following an assassination attempt in 2017, was detained on Sunday before being released on bail hours later.
The veteran opposition leader and other members of his Chadema party, the East African nation's main opposition party, were enroute to the Ngorongoro conservation area where Maasai pastoralists are protesting government attempts to relocate them.
Justine Masejo, a senior police official said the "investigation is still ongoing," adding, "we will move ahead with other legal steps after completing the investigation."
Lissu Saturday said police "blocked" him from going to Ngorongoro and subsequently dispersed a sit-in protest held by him and his team.
Speaking after his release, Lissu said "Ngorongoro is not a prison."
"Police feared I would tell the truth about what is going on there about the eviction of the Maasai," he added.
Tanzanian president Samia Suluhu Hassan lifted the ban on political rallies in January this year, part of a push to overturn some of the policies imposed by her authoritarian predecessor, John Magufuli.
Lissu, an outspoken critic of Magufuli and the governing CCM party, was shot 16 times while seated in his car in 2017 and spent the next few years recovering in Belgium before returning home to a rousing welcome this year.