The National Prosecuting Authority (NPA) could not continue with the prosecution against African National Congress (ANC) president Jacob Zuma, acting National Director of Public Prosecutions (NDPP) Mokotedi Mpshe said on Monday.
Mpshe told reporters in Pretoria it was: "Neither possible nor desirable for the NPA to continue with the prosecution of Mr Zuma".
He continued: "It would be unfair as well as unjust to continue with the prosecution."
The announcement paves the way for Zuma to become South Africa's next President without the prospect of impending prosecution.
Zuma was facing 16 charges linked to a multi-billion rand government arms deal, including one of racketeering, one of money laundering, two of corruption and 12 of fraud.
Mpshe's announcement ends a long legal battle between the authority and the ruling party's presidential candidate.
It follows weeks of media reports that the charges would be dropped amid news that the NPA was considering new representations on the case.
In August 2003 the then NDPP Bulelani Ngcuka announced that Zuma's former financial adviser Schabir Shaik would be charged with corruption and fraud, adding that though there was a prima facie case against Zuma, the NPA would not be charging him because it did not believe the case was winnable.
Zuma cried foul, claiming a political conspiracy aimed at derailing his bid to succeed Mbeki in the presidency, an assertion he has maintained ever since.
Shaik went on trial a year later, and in June 2005 was sentenced to 15 years in prison.
Just under two weeks later Mbeki sacked Zuma from the deputy presidency, naming Ngcuka's wife Phumzile Mlambo-Ngcuka in his place, and a week after that the NDPP announced it was going to prosecute Zuma for alleged corruption.
He was then charged but the case was struck off the role.
After addressing the ANC as its president for the first time in 2007, Zuma was served with an indictment by the NPA ordering him to appear in court on August 4, 2008.
Following an application by his lawyers, on September 12, 2008 in the Durban High Court, Judge Chris Nicholson ruled the State's decision to prosecute him was unlawful because the State had failed to take representations from Zuma.
The ruling was seen as a vindication for the ANC president as the judge in his ruling said the former deputy president was not wrong to infer a political conspiracy against him.
In January this year, the Supreme Court of Appeal upheld an appeal by the NDPP against Nicholson's ruling.
The criminal charges against Zuma were then reinstated.
The NPA dropping the charges means that Zuma is to become president after the April 22 elections, he will no longer have the charges hanging over his head.