Seattle native Knox and Italian computer student Raffaele Sollecito had appealed against a 2009 verdict that found them guilty of murdering 21-year-old Kercher during what prosecutors said was a drug-fueled sexual assault four years ago.
Looking pale and tense as the sentence was read out in a packed Perugia courtroom, Knox was led away in tears -- and close to collapse -- by police officers.
The court quashed the convictions against Knox, who had been sentenced to 26 years in jail, and against Sollecito, who had been sentenced to 25 years, after independent forensic investigators sharply criticized police scientific evidence, saying it was unreliable.
Kercher’s half-naked body, with more than 40 wounds and a deep gash in the throat, was found in 2007 in the apartment she shared with Knox in the Umbrian hill town of Perugia where both were studying.
Both Knox and Sollecito, 27, had consistently maintained their innocence throughout the original investigation and trial. A third man, Ivorian drug dealer Rudy Guede, was imprisoned for 16 years for his role in the slaying.
The court upheld a conviction against Knox for slander after she had falsely accused barman Patrick Lumumba of the murders. It sentenced her to three years in prison, a sentence which has now been served.
Knox’s good looks and the salacious details of the murder helped make a global media sensation of the trial, which attracted hundreds of reporters from around the world to the packed Perugia courtroom.
Expectations were running high before the verdict that Knox and Sollecito would walk free after the forensic review discredited DNA evidence used to convict them.
In a tearful address to the court earlier on Monday, Knox pleaded with the panel of two professional and six lay judges to free her, saying she was paying for a crime she did not commit.
“I did not do the things they say I did. I did not kill, rape or steal. I was not there,” she said in the fluent Italian she has learned in prison.
The appeal trial gripped attention on both sides of the Atlantic, with an outpouring of sympathy and outrage from many in the United States who saw the American as an innocent girl trapped abroad in the clutches of a medieval justice system.
A powerful lobbying campaign by her family played a big part in changing perceptions of Knox from the promiscuous “Foxy Knoxy” of early media reports and the cold-blooded, sex-obsessed “she-devil” portrayed by prosecutors.
In the process, her plight in jail dominated reporting of the trial, leaving Kercher’s family feeling the real victim of the crime had been pushed to one side.
“Mez has been almost forgotten in all of this,” her sister Stephanie told a news conference as the family emphasised that the brutality of the crime must not be forgotten.
Kercher, a Leeds University student from Coulsdon in Surrey, was on a year-long exchange programme in Perugia when she was murdered, bringing a flood of unwelcome attention to the medieval town in central Italy that her family said she loved.
The murder investigation showed she was pinned down and stabbed to death. Prosecutors said she resisted attempts by Knox, Sollecito and Guede to involve her in an orgy.
But their case was weakened by forensic experts who dismissed police evidence that traces of DNA belonging to Knox and Kercher were found on a kitchen knife identified as the murder weapon.
The experts also said alleged traces of Sollecito’s DNA on the Briton’s bra clasp may have been contaminated.
The defense argued that no clear motive or evidence linking the defendants to the crime have emerged, adding that Knox was falsely implicated in the killing by prosecutors determined to convict her regardless of the evidence.