The review by Her Majesty's Inspectorate of Constabulary and Fire & Rescue Services (HMICFRS), led by Sir Thomas Winsor, also found the force was "justified" in taking the view the risks of Covid-19 transmission were "too great to ignore".
Sir Thomas, the Chief Inspector of Constabulary, said: "My thoughts are with Sarah Everard's family and friends, who are suffering the most unthinkable pain.
"The commissions I received from the Home Secretary and the Mayor of London to inspect the Metropolitan Police's handling of the vigil for Sarah Everard on Clapham Common have been fulfilled. This has been a rapid but detailed inspection.
"Public confidence in the police is critical. It is therefore important that there has been an independent, objective, evidence-based inspection to provide public reassurance, which we provide today.
"Our civilian police model is precious. Officers are our fellow citizens, invested by the community to keep the community safe.
"They rely upon and are entitled to receive public support when they act lawfully, sensitively and proportionately; in this case, in the face of severe provocation and in very difficult circumstances, they did just that."
The body of 33-year-old Sarah Everard was found on March 10 after she went missing a week earlier.
A Met police officer, Wayne Couzens, has been arrested in relation to her death.
Reclaim These Streets, the original organisers of the vigil for Sarah Everard, said the report from HMICFRS was “disappointing” and demonstrated “institutional sexism running through the force”.
In a statement on Twitter, the group said: “The HMICFRS interviewed Reclaim These Streets for over 10 hours.
"The Met Police antagonistic actions around the vigil forced us to cancel the event, which then in turn, caused a greater number of people to attend due to their publicity.
"We warned the Met Police on Friday night, that forcing us to cancel would cause additional risk to public safety, as did Lambeth Council.
"They completely dismissed our warning and concerns.
“The report also shows a failure from the Home Secretary and Policing Minister on providing a political steer for the police on this event.
"They agreed with the NPCC to provide a statement, but failed to so – meaning senior officers, who according to the report fail to demonstrate an understanding of Human Rights law.
"Where police officers are faced with making finely-balanced decisions in difficult circumstances, it is essential that the law is clear.
"It is incumbent on the legislature to provide a set of rules that is (first) readily capable of being accurately interpreted and applied and (second) likely to attract a high degree of public acceptance and consent.”
“Instead of taking responsibility for their actions, The Metropolitan Police is standing behind claims that we were inexperienced organisers, despite some of us being elected officials and others having a decade long track record of working with police and councils on events.
"We anticipated a fair and balanced inquiry and are instead being told not to believe what we saw and heard reported two weeks ago.
"This inquiry is not representative of our experience with senior Met officials.”
Reporting by PA