"Director of Public Prosecution, Marianne Ny, has today decided to discontinue the investigation regarding suspected rape by Julian Assange," the prosecutor's office said in a statement.
The 45-year-old Australian denies the 2010 allegations which he fears will see him extradited to the United States and tried over the leaking of hundreds of thousands of secret US military and diplomatic documents.
Assange was questioned in November in the presence of a Swedish prosecutor. He has repeatedly reiterated his innocence and said the sex was consensual.
Marianne Ny and Chief Prosecutor Ingrid Isgren are set to hold a press conference on the decision at 12:00 (1000 GMT) on Friday.
The statute of limitations on the rape allegation was due to expire in August 2020.
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