Back in August, Lochte was indicted for "false reporting of a crime" for falsely stating that he and three teammates were robbed at gunpoint in an interview with NBC News.
Rio police later said that the Olympians had vandalized the gas station bathroom by breaking a soap dispenser and mirror, and destroying a poster outside the restroom.
The 32-year-old Olympic swimmer's criminal case has been dismissed by an appellate court in Brazil, according to USA Today.
Lochte stood by his story and his lawyers fought to clear him of criminal charges, but a three-judge panel in a lower court upheld the charge 2-1.
The Brazilian appeals court ruled in Lochte's favor 2-1 Thursday, attorney Jeff Ostrow told NBC 6. The U.S. swimmer had been accused of fabricating a story about getting robbed at gunpoint in Rio de Janeiro during August's Olympics, causing an worldwide scandal that drew in some of his teammates. They add that the decision has not been published yet and prosecutors will have 15 days to appeal the ruling.
Lochte had previously earned a 10-month suspension from the national swim team, a penalty that has concluded as of July 1, allowing him to return to action.
The investigation found that Lochte and has teammates had been detained by armed security guards, who drew their weapons and demanded that the swimmers pay them money for the alleged vandalism at the gas station.
Since the incident, the athlete got engaged to model Kayla Rae Reid in October 2016, and they had their first child Caiden Zane Lochte in June of this year.
"That's why I'm taking full responsibility for it is because I over-exaggerated that story", he said.
The 32-year-old has said he wants to return to top-level competitions, though, and represent the U.S.at the 2020 Olympics in Tokyo.