Lalu was sentenced to three-and-a-half years in jail in a fodder scam case for offenses of cheating, along with criminal conspiracy, and other sections of the Indian Penal Code (IPC).
Lalu was also given a jail term of three years and six months in the case under the Prevention of Corruption Act (PCA).
He was fined Rs 5 lakh each under the IPC and the PCA, CBI counsel Rakesh Prasad said, adding that failure to pay the fine would entail another six months in jail.
The sentences will run concurrently, he said.
The scam is related to withdrawal of Rs 89.27 lakh from the Deogarh Treasury between 1990 and 1994 when Lalu was the chief minister of Bihar.
After the sentenced was announced, in a tweet from his Twitter handle, Lalu Yadav said, "Rather than practising BJP’s Simple Rule - “Follow us or We will Fix you”. I will die happily fixing myself for Social justice, harmony & equality".
Lalu's twitter account is currently handled by his office in consultation with his family.
The 69-year-old leader also shared an open letter from his twitter account.
Reacting to the judgement, Lalu's son and former Bihar deputy chief minister Tejashwi Yadav said they will approach High Court for bail.
"The judiciary performed its duty. We will go to the High Court after studying the sentence and apply for a bail," he said.
"Lalu is not the name of a person but of an ideology. We, his followers, will not be cowed down," said the 28-year-old Leader of Opposition in the state assembly.
Tejashwi's elder brother Tej Pratap Yadav said his father Lalu has been harassed for always raising his voice for social justice and secularism.
"History has it that whenever Laluji was pressurised or harassed our party has gained people's support. Forces that are against secularism and social justice want to muzzle Laluji's voice by conspiring against him," he said.
Tej Pratap said Lalu had participated in the JP movement and was jailed several times.
"Now there will be an LP (Lalu Prasad) movement. Now my sole aim would be to get justice for Laluji and for the poor," he said.
Bihar Deputy Chief Minister Sushil Modi welcomed the judgment, saying: “Conviction is conviction. Either 3.5 yrs or 7 yrs. Our charges against Lalu has been vindicated by Court".
JDU leader and Rajya Sabha MP KC Tyagi termed the court's verdict on Lalu as "historic".
"We welcome this judgement, this will prove to be a historic decision in Bihar politics. It is the end of a chapter," he said.