Portsmouth South MP Mike Hancock will face no further police action in relation to alleged sexual assault claims.
A Hampshire Police statement said it had discussed the case with the Crown Prosecution Service and would not be taking any further action.
Mr Hancock, who is also a councillor, had strongly denied the allegations.
An independent report released in September found he failed to observe the council's code of conduct.
Hampshire Police said it had informed those affected by the decision.
Mr Hancock said: "I'm personally delighted and pleased they have come to that conclusion."
The Liberal Democrat MP was arrested in 2010 on suspicion of sexual assault, but was not charged with any offence.
Mr Hancock, who temporarily stood down from the parliamentary Lib Dem party in June, is currently involved in a High Court civil dispute over sexual assault allegations made by a female constituent.
Last week, Portsmouth City Council's standards committee decided to not to proceed with any investigation into Mr Hancock until the court proceedings have concluded.
The independent report by Nigel Pascoe QC, produced as part of the council's code of conduct investigation regarding Mr Hancock, was given to the police at their request.