The 69-year-old actor, who was not keeping well of late, was hospitalised due to "exhaustion and weakness".
"He is much better now. He is fine. He is not being discharged today. He would be here (hospital) for a couple of days," Khanna's estranged wife Dimple Kapadia who is now by his side, revealed.
Earlier, Dimple had said the actor would be discharged in a day or two. Khanna's manager Ashwin had said earlier this week that the actor had stopped taking food for three-four days though he was at home.
Soon after, Kaka, as the actor is fondly referred to in the industry, emerged at the balcony of his house Aashirwad on Carter Road in Bandra to wave at his fans and media persons.
His son-in-law, Bollywood star Akshay Kumar, assured the media and fans that Khanna was "hearty and healthy", but the senior actor was admitted to the hospital two days later.
Earlier in April too the actor was admitted to the hospital after he complained of uneasiness and exhaustion. He was hailed as India's first superstar after 15 consecutive solo superhits between 1969 and 1972 including 'Aradhana', 'Haathi Mere Saathi', 'Anand' and 'Amar Prem'.
He was recently seen in his first television ad, directed by filmmaker R Balki, for a fan brand.