Hadid was arrested for possession of marijuana while vacationing on the Caribbean island.
The 28-year-old model and her friend, Leah McCarthy, were arrested and then released in the Cayman Islands after customs officials found marijuana in their possession.
"Gigi was traveling with marijuana purchased legally in New York City with a medical license. It has also been legal for medical use in Grand Cayman since 2017. Her record remains clear and she enjoyed the rest of her time on the island," Hadid's rep told ET in a statement.
The news was first reported by local Cayman Island newspaper, Cayman Mal Road.
Hadid took to Instagram on Tuesday after the news broke to share a look at her Island getaway, complete with time in the Caribbean's crystal blue waters, bikini pics and delicious eats by the beach.
"All’s well that ends well🌅," Hadid captioned the post, signaling that despite the little hiccup, she and her friends are loving island life.
She shared more shots on her Stories, re-posting an image from Alana O'Herlihy, who is also on vacation with Hadid and McCarthy, as well as a call to the post on her feed.
McCarthy poked fun at the incident in a post of her own, sharing more beachside pics with the caption, "Being this cute ? Guilty on all charges."
According to Cayman Mal Road, on July 10, a private plane carrying the model and McCarthy landed at the Owen Roberts International Airport General Aviation Terminal from the United States. Hadid and McCarthy were detained after a scan by the Customs and Border Control Officer found a small amount of marijuana and "utensils used for the consumption of ganja" were recovered from their luggage.
The publication states that Hadid and McCarthy were arrested for importation of ganja and importation of utensils and were taken to a prisoner detention center where they were processed and released on bail.
Two days after the arrest, the Next in Fashion host and McCarthy appeared in Summary Court where they were both charged. The women pleaded guilty and were fined $1,000. There is no file of the conviction.