"Nelson Mandela had a restful day," the presidency said in a statement, adding doctors treating him had reported "a further improvement in his condition".
"Government is satisfied that the doctors are providing the former president with the best medical care possible to enable his recovery and comfort," the statement said.
Earlier Presidential spokesperson Mac Maharaj said in the statement, "Doctors advise that due to the lung infection former President Mandela had developed a pleural effusion which was tapped. This has resulted in him now being able to breathe without difficulty. He continues to respond to treatment and is comfortable."
The Nobel Peace Prize laureate, often fondly called by his clan name 'Madiba', was re-admitted to an undisclosed hospital in Pretoria before midnight on Wednesday for the third time in four months.
Earlier this month, Mandela spent a night at a Pretoria hospital where he underwent a successful medical examination.
Three months ago, he was admitted for 18 days for treatment of the lung infection and surgery to extract gallstones.
It was his longest stint in hospital since his release from prison in 1990. Mandela had a long history of lung problems, dating back to the time when he was a political prisoner on Robben Island during apartheid.
While in jail he contracted tuberculosis. Mandela served as South Africa's first black president from 1994 to 1999 and is widely regarded as the father of the nation for leading the struggle against apartheid and for democracy.