Egypt's highest court cancelled jail sentences against three journalists working for Al Jazeera television on Thursday and ordered a retrial, a defence lawyer said, in a case that has provoked an international outcry.

Australian Peter Greste, Canadian-Egyptian Mohamed Fahmy and Egyptian national Baher Mohamed were serving seven- to ten-year sentences on charges of aiding the outlawed Muslim Brotherhood and publishing false news about Egypt.

Speculation has been growing that President Abdel Fattah al-Sisi could pardon or deport the men.

"They will not be released until they appear before the new chamber, which will decide whether to release them or not," said defence attorney Mostafa Nagy.

The journalists say they were merely reporting the news when first arrested in December 2013. The case has raised questions about Egypt's democratic credentials.

"We need some time to process. It's not as positive as we had hoped," Greste's mother, Lois, said of the court decision.

Human rights groups say repression has been growing in Egypt since then army chief Sisi toppled President Mohamed Mursi of the Muslim Brotherhood in July of 2013 after mass protests against him.

Mursi's ouster damaged ties between Egypt and Qatar, which backed the Brotherhood. But tensions appear to be easing, raising hopes that the Al Jazeera journalists could be freed.

Saudi Arabia has brokered an effort to repair relations between the two countries after agreeing with the United Arab Emirates and Bahrain to end an eight-month diplomatic dispute over Qatar's support for the Brotherhood and promotion of "Arab Spring" revolts. – Reuters