"The state clearly has not proved beyond reasonable doubt that the accused is guilty of premeditated murder," Thokozile Masipa said, before dealing with the lesser charge of culpable homicide -- also known as manslaughter.
"Viewed in its totality the evidence failed to establish that the accused had the requisite intention to kill the deceased let alone with premeditation," said Masipa.
"Clearly he did not objectively foresee this as a possibility, that he would kill the person behind the door," she said as she later dismissed the lesser charge of common murder.
Pistorius was charged with one count of murder and three firearms offences over the killing on Valentine's Day 2013.
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He could still be found guilty of culpable homicide, carrying anything from a suspended sentence to a lengthy prison stretch, or he could be acquitted.
A charge of premeditated murder would have meant a life sentence in South Africa's notoriously brutal jails.
- 'Evasive' -
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Pistorius had grimaced and sniffled as he watched Masipa call Pretoria's High Court to order and read her verdict.
But the sprinter says he thought he was shooting at an intruder while Steenkamp was safely in bed.