I used a credit card to reserve a hotel stay but paid in cash -- can they still have a hold on my card?

A week ago I reserved a hotel for two nights and was told they were going to charge one night to my credit card. They did, and when I checked out I paid for both nights and my credit card was refunded for the one night. But now they have a hold on my account for $200. Is this legal? Can they hold that indefinitely for no reason? They told me after they refunded my card that it would not be used for anything else.I used a credit card to reserve a hotel stay but paid in cash -- can they still have a hold on my card?
They only hold it for a couple of days for incidentals you may have incurred, like phone calls or something. They always put it back in mine in about 3 days.