* Birtukan in prison for almost two years
* Says she is elated, but refuses to talk politics
* Apologises for "deceiving the Ethiopian people"
(Adds Birtukan quotes, government statement, British reaction)
By Barry Malone
ADDIS ABABA, Oct 6 (Reuters) - Ethiopia released the country's most prominent opposition leader from jail on Wednesday, four months after the government's landslide win in elections criticised by Western powers.
Birtukan Mideksa, a former judge, is the leader of Ethiopia's biggest opposition party, Unity for Democracy and Justice. She left Kaliti prison in Addis Ababa with her daughter and mother.
Her car slowed to a crawl as about a thousand supporters lined narrow streets decorated with flags and posters near her home on the outskirts of the capital.
Supporters, some in T-shirts bearing her image, chanted and sang "Birtukan is our Mandela" and "No government is stronger than God" as they threw flowers on a red carpet that marked out the last few hundred metres to her house.
Government opponents say she was jailed because she was a threat to the ruling Ethiopian People's Revolutionary Democratic Front (EPRDF) at the May 23 election, which gave Prime Minister Meles Zenawi another five-year mandate.
The government denies that.
Some analysts said the release could be a drive to repair damage to the country's democratic credentials following the overwhelming election win. Washington said the election failed to meet international standards.
"This may be part of a broader campaign to reorient the political system so that it at least appears to be more democratic," said David Shinn, a former U.S. envoy to Ethiopia.
"In fact, it might even become more democratic. Many of the original EPRDF leaders have moved or are moving to the sidelines," he told Reuters.
Meles, in power since 1991, was sworn in as prime minister again on Monday after the May vote gave his party and allies 545 seats in the 547-seat parliament.
APOLOGY TO ETHIOPIA
Despite reports that Birtukan's mental and physical health had suffered while in prison, she looked fit as she waved to the crowds and chatted on a mobile phone.
"I am elated," she told reporters on the veranda of her house. "Prison was horrible, especially for me, especially when I was in solitary confinement. But I passed through it and am back with my family now."
When asked about her political plans, Birtukan replied: "That is for another time."
Ethiopia is a key Western ally in the Horn of Africa, where it is seen as a bulwark against militant Islamism. The country also wants to attract foreign investment in large scale farming and oil and gas exploration.
Britain, one of Ethiopia's biggest donors, called Birtukan's release "an important step forward".
Ethiopia's previous elections in 2005 ended in bloodshed when the opposition disputed a government victory and riots tore through the capital, killing 193 protesters and seven policemen.
Opposition leaders, including Birtukan, were jailed for life after the government said they had sparked the violence in an attempt to overthrow the administration.
They were pardoned and released in 2007 when they signed a letter admitting to provoking the violence. Birtukan was sent back to prison in December 2008 after she denied responsibility for the trouble and said she had not asked for a pardon.
The government said it had pardoned Birtukan on Wednesday because she had admitted to asking for the first pardon.
"In her remorseful petition Birtukan Medeksa implored the Prime Minster to grant her a second pardon to be able to attend to her ageing mother and child," the statement said.
Birtukan confirmed she asked for the new pardon last month.
"I apologise for deceiving the Ethiopian people and government. I will not involve myself in such deceptive acts in the future," the agreement that Birtukan signed read, referring to her denial of asking for the original pardon.
(Editing by David Clarke and Giles Elgood)
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