Jurors in Santa Maria, California, also acquitted the 46-year-old father of three of conspiracy, one count of attempted molestation and four counts of plying his underage accuser with alcohol.
As Jackson fans cheered, whistled and clapped outside the courthouse, jurors on Monday found the superstar not guilty of the charges that could have sent him to jail for up to 20 years.
Outside the courthouse, a woman fan of Jackson in the throng released one white dove each time an acquittal was read. Other fans hugged and cried and screamed, in relief and joy.
Jurors also acquitted the King-of-Pop of conspiring to imprison his accuser and the boy's family at the storybook estate - a total legal victory but one that may do little to improve his bizarre image.
Jackson fans cheered and clapped
outside the courthouse
The jury also declared Jackson innocent of getting the boy drunk before molesting him, and conspiring to imprison the accuser and his family at his Neverland ranch.
Jackson looked straight ahead as the verdicts were read and showed no visible reaction as he was repeatedly found not guilty.
The verdict - reached after about 30 hours of deliberations over seven days - ended a star-studded, four-month trial that offered a global audience a lurid look into the world of Jackson and presented jurors with vastly different portraits of him - A creepy pervert who preyed on little boys, or the victim of a frame-up by mother-and-son shakedown artists.
As Jackson walked out of court a free man, fans screamed and danced, but Jackson appeared subdued. He briefly waved once at the crowd, but did not say a word.
The trial had visibly taken a heavy toll on him, and the popstar had lost considerable weight in the past few months.