The tearful family of 18-year-old Michael Brown, who was shot dead in August, expressed profound disappointment after St Louis County prosecutor Robert McCulloch relayed the grand jury's decision.
A crowd of several hundred protesters gathered in front of the police station in Ferguson where Officer Darren Wilson was based chanting: "Hey, hey, ho, ho! These killer cops have got to go."
But there were no initial reports of violence, amid tight security and lines of officers in riot gear awaiting the highly-anticipated verdict. Brown's devastated mother was hugged by supporters.
He said "an altercation" had broken out as Wilson was sitting in his patrol car and Brown was standing at the window.
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"During the altercation, two shots were fired by Officer Wilson while still inside the vehicle," McCulloch said.
"Mr Brown ran east... And Officer Wilson gave chase," he said. "Mr Brown stopped and turned back toward Officer Wilson.
"Officer Wilson also stopped. Michael Brown moved toward Officer Wilson. Several more shots were fired by the officer and Michael Brown was fatally wounded."
"We are profoundly disappointed that the killer of our child will not face the consequence of his actions," the Brown family said in a statement.
"We respectfully ask that you please keep your protests peaceful," the family said, calling for legal reform.
"Answering violence with violence is not the appropriate reaction."
Brown, an 18-year-old high school graduate who had planned to go to technical college, was shot at least six times by Wilson in an incident on a Ferguson street.