Damian Alcorn, who is 33, was arrested at the weekend by Traffic Corps Gardaí at Emyvale, Co Monaghan, just as he was about to drive into Co Tyrone.
It was alleged at Monaghan District Court that Alcorn, from Drumabodan, Kilmacrennan, had the cocaine in his possession and was returning to Donegal from Dublin at the time of his arrest.
He was charged with possession of a Class A drug and possession of a Class A drug with intent to supply.
Gardaí opposed a bail application.
However Judge Conal Gibbons released Alcorn on a €1,000 cash bail.
The accused man was ordered to reside at his address, close to Leitir just outside Kilmcrennan.
He was also ordered to sign on three times per week at Letterkenny Garda Station.
Today’s court appearance followed a major operation by Gardaí. A 32-year-old woman who was in the car with Alcorn was released without charge.