Miss Knox, 24, and Mr Sollecito, 27, had been convicted in 2009 of murdering the Leeds University student, 21, from south London, two years earlier..
American Miss Knox sobbed as they were freed after nearly four years in jail.
Miss Kercher's family said they did not understand how the original verdict could be so "radically overturned".
However, the family - in Perugia for the decision - added in a statement: "We still trust the Italian justice system and hope that the truth will eventually emerge."
The judge had upheld Miss Knox's conviction for slander after she accused bar owner Patrick Diya Lumumba of carrying out the killing. He set the sentence at three years, time that Miss Knox has already served.
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