Paislee Shultis, now six, was discovered in a house in the town of Saugerties after a search on Monday.
She is in good health and has now been reunited with her legal guardian and older sister, the police say.
Her non-custodial parents have been charged with custodial interference and endangering the welfare of a child.
Paislee was reported missing from Tioga County, New York, in July 2019, according to a police statement. She was aged four.
Authorities at the time believed she had been abducted by her parents, Kimberly Cooper, 33, and Kirk Shultis Jr., 32.
