Swedish prosecutors on Friday dropped a seven-year rape investigation into Julian Assange, a legal victory for the WikiLeaks founder who has been holed up in the Ecuadoran embassy in London since 2012.
But British police said they would still arrest Assange if he tried to leave the embassy, saying he had breached the terms of his bail by refusing to turn himself in when an arrest warrant was issued in 2012.
Friday was the deadline for the public prosecutor's office to either renew the pan-European arrest warrant or lift it.
"Director of Public Prosecution, Marianne Ny, has decided to discontinue the investigation regarding suspected rape by Julian Assange," the prosecutor's office said in a statement.
Shortly after the announcement, Assange posted on Twitter a picture of himself smiling broadly, without comment.
A lawyer on Assange's legal team, Per Samuelsson, told Swedish radio the decision was "a total victory", saying that Assange was "of course happy and relieved".
Samuelsson also said that the decision meant Assange "is free to leave the embassy whenever he wants", though he later told the TT news agency that he did not know when Assange might leave.
"What I do know is that Sweden does not stop him from doing it. Sweden is out of the game," he said.
Another lawyer, Christophe Marchand said that "We have been waiting a long time for this decision".
"Julian Assange has been a victim of a huge abuse of procedure. We are very pleased and very moved, as this marks the end of his nightmare."
Ny and Chief Prosecutor Ingrid Isgren were briefing reporters on the decision in Stockholm.
The 45-year-old Australian has always denied the 2010 rape allegations, which he feared would see him extradited to the United States and tried over the leaking of hundreds of thousands of secret US military and diplomatic documents.
He has been living at the Ecuadoran embassy in London since 2012, and the British police have said they will arrest Assange as soon as he walks out of the embassy because he has broken his conditions for bail — a relatively minor offence under British law — by failing to surrender on June 29, 2012 for extradition to Sweden.
Britain's Crown Prosecution Service said that breach of bail is punishable by up to a year in prison or a fine.