Per E. Samuelson, Assange's lawyer in Sweden, told The Associated Press that it was a "day of victory" for the WikiLeaks founder.
In a brief statement on the Swedish Prosecution Authority website, the body said director of Public Prosecution, Ms Marianne Ny, has today chose to discontinue the investigation regarding suspected rape (lesser degree) by Julian Assange.
In a statement on Friday, Sweden's top prosecutor said the investigation into Assange over rape allegations would be dropped, as "all prospects of pursuing the investigation are now exhausted".
"My assessment is the transfer can not be carried out in a foreseeable future", Ny told a news conference in Stockholm, adding that Assange had avoided all attempts by British and Swedish authorities to arrest him.
The Wikileaks founder took refuge in Ecuador's embassy in London in June 2012, days after losing court battles to avoid extradition to Sweden to rape accusations, which he denies.
Assange has stayed in the embassy fearing he could be sent to Sweden by British officials and then perhaps extradited to the United States, where he is wanted over the release by WikiLeaks of 500,000 secret military files on the wars in Afghanistan and Iraq. His self-imprisonment came on the heels of a rape investigation against him in Sweden involving two women. Scotland Yard intends to act on a warrant for Assange's arrest that was issued after he defied a bail order in 2012.
The Swedish prosecutor's office said in a statement it had made a decision to end its investigation.
The Justice Department investigation of Assange and WikiLeaks dates to at least 2010, when the site first gained wide attention for posting thousands of files stolen by Manning.More news: In the USA , several people fell from the Ferris wheel
While it was known that a grand jury had been established in Virginia in relation to Assange and the Manning cables under the Obama administration, Assange's fears were validated last month when it was revealed United States authorities meant to charge Assange despite the clear violation of the First Amendment such a prosecution of a publisher would constitute.
November: Assange loses a legal move in a Swedish appeal court aimed at revoking his arrest warrant.
"The decision to discontinue the preliminary investigation is not because we've been able to make a full assessment of the evidence in this case, but because we didn't see any possibilities to advance the investigation forward". President Donald Trump has said it is "OK" with him if Sessions does that.
The Washington Post reported that in response to the news, Per E Samuelsson, Assange's Swedish lawyer, told a local radio station that this is a "total victory for Julian Assange". The news service reports he also called on the U.K.to allow Assange safe passage back to Ecuador.
The metropolitan police says there is a British warrant for MrAssange's arrest after he jumped bail in 2012, and the force "is obliged to execute that warrant should he leave the embassy".
If the warrant has been issued, and if Assange is taken into custody in the United Kingdom, he could potentially still face extradition. The charges against Assange were brought by Swedish authorities in August 2010 but were soon dropped.
In a tweet, Wikileaks said the "focus now moves to the UK".
Today, they said Assange was previously wanted for "an extremely serious offence" in Sweden and the police presence around the embassy had "reflected the serious nature of that crime".
Police kept up round-the-clock guard outside the embassy until a year ago, when the operation was scaled back.