Colin Boyd, QC, the Lord Advocate, took the unprecedented step of writing to George Reid, the Scottish Parliament's Presiding Officer, amid growing demands for a full public inquiry.
Ms McKie, 43, a former Strathclyde Police detective, was wrongly accused of leaving her fingerprint at a murder scene and has fought a nine-year battle to clear her name. She claims the failure to prosecute anyone at the Scottish Criminal Records Office (SCRO) over the incident is as a result of a conspiracy by the legal establishment.
But the Lord Advocate said he chose not to proceed with a criminal case because of "conflicting" evidence from fingerprint experts. He also defended the original decision to prosecute Ms McKie for perjury, saying there was "sufficient evidence in law" for a trial.
Last night, Shirley's father, Iain McKie, said he was "disgusted" at Mr Boyd's letter and insisted he had "irrefutable" evidence to support a criminal prosecution. The Lord Advocate was also accused of "trying to defend the indefensible" by one MSP.
The Crown Office was reportedly told five years ago that, after the original mistake had been made, it was covered up in a "criminal" manner, as the fingerprint service refused to accept it had been wrong. One theory is that prosecutors did not want to undermine the case against David Asbury, who was tried and convicted of murdering Marion Ross. It was during this case that Ms McKie was alleged to have left a fingerprint at the murder scene, a claim she denied.
After Asbury was convicted, Ms McKie was tried for perjury but was acquitted after evidence from two US fingerprint experts refuted the claim that the print was hers. Asbury later had his conviction quashed on appeal.
Ms McKie has always insisted the print was not hers and was last week awarded 750,000 compensation by the Scottish Executive in an out-of-court settlement. The First Minister, Jack McConnell, insisted there had been an "honest mistake" by fingerprint experts who wrongly accused her of intruding on the murder scene in 1997.
Mr Boyd - who yesterday made clear he supports the Executive's decision not to hold a public inquiry - said the decision to prosecute Ms McKie for perjury was taken by him, as Solicitor General, in 1998, following a report by the regional procurator fiscal for Glasgow.
"I am satisfied that the evidence available at the time justified criminal proceedings," he said. "The evidence against her was tested at trial. There was clearly sufficient evidence in law, because the case went to the jury, who ultimately acquitted her."
Senior officers at Tayside Police were then instructed by the regional procurator fiscal for North Strathclyde to investigate possible perjury and criminal conspiracy in relation to the fingerprint officer who gave evidence in the Asbury and McKie trials.
A report, which included "careful examination of expert evidence", was submitted to Mr Boyd in 2001.
His letter to Mr Reid stated: "Following full and careful consideration of these reports, I concluded that there was insufficient reliable evidence to found a prosecution. Before any proceedings in respect of that evidence could have been contemplated, I would require to have been satisfied that a court could accept beyond reasonable doubt not only that there was a misidentification, but that the evidence was given dishonestly and with criminal intent.
"In the light of the whole evidence available to me, including evidence from experts instructed by the defence which supported the SCRO evidence, it was clear that such intent could not be demonstrated.
"Since the time the issue arose in the trial of Shirley McKie, there have always been, and there remain, conflicting expert views on the issue of identification of the relevant fingerprints. I concluded in 2001 that the conflict in expert evidence was such that there could be no question of criminal proceedings."
Mr McKie said the letter failed to shed any new light on his daughter's case and that the need for a public inquiry was "greater than ever".
"The cover-up continues," he said. "I'm absolutely disgusted at this statement by the Lord Advocate - he hasn't told us anything we do not already know.
"The Lord Advocate is saying there was evidence on both sides, but there was overwhelming evidence the experts were wrong and overwhelming evidence ... that there was criminality."
Alex Neil, an SNP MSP for Central Scotland who has lodged a parliamentary motion of no confidence in Mr Boyd, claimed the Lord Advocate and Cathy Jamieson, the justice minister, were "trying to defend the indefensible". He said: "This simply underlines the need for a full public inquiry."