The two-metre-long animal was released on August 15 by the Phu Quoc National Park Management Board and local residents after checks confirmed it was healthy and uninjured.
The animal was discovered at around 8.30 am on August 14 when Hoang Trung Thong, an employee at Camia restaurant on Phu Quoc, spotted it crawling into the kitchen.
Because of its large size, Thong carefully secured the animal and contacted Nguyen Thanh Binh, a local resident with knowledge of wildlife, to help identify it.
Binh identified the animal as an Asian water monitor (Varanus salvator), a species listed in the Vietnam Red Data Book. He temporarily cared for it before contacting the Phu Quoc National Park Management Board.
After examining the animal and finding no injuries, park authorities and local residents released it safely back into the wild.
Local authorities said the appearance of such a large monitor lizard near a residential area highlighted the rich biodiversity of Phu Quoc National Park, part of the UNESCO-recognised Kien Giang Biosphere Reserve.
Covering more than 31,400 hectares, or over 40 per cent of Phu Quoc Island, the national park is home to tropical forest ecosystems and numerous rare and endangered species.
These include Indochinese silvered langurs, slow lorises, small-clawed otters, great hornbills, monitor lizards, pythons and several turtle species.
Authorities said releasing the animal back into its natural habitat would contribute to biodiversity conservation and help raise public awareness of wildlife protection.