Oric, 41, was convicted in 2006 for failing to prevent the killing and torture of Serb prisoners and the destruction of Serb villages in Srebrenica. He received two years in prison, but was immediately released taking into account the three years he had already spent in custody pending trial.
In quashing his convictions, the appeal judges said they had overturned the previous ruling as there was insufficient evidence to establish he was aware of the crimes and was in full control of the troops, who committed them.
Presiding judge Wolfgang Schomburg said: "The appeals chamber has no doubt that grave crimes were committed against Serbs detained in Srebrenica," but added that "proof that crimes have occurred is not sufficient to sustain a conviction of an individual for these crimes."
Oric said he did not believe Muslims had been responsible for the crimes, saying they were under siege from Bosnian Serb forces and desperately fighting for their lives.
"I don't think they really committed crimes," he said, "We were just fighting to survive and fighting for our lives."
Srebrenica was the scene of a massacre in 1995, when Bosnian Serbs killed thousands of Muslim men and boys in the worst atrocity of the 1992-95 conflict.
