Prosecutors had been considering a police report in relation to Scottish Liberal Democrat MSP, Alex Cole-Hamilton, 39, in connection with an alleged incident on June 7, 2016.
Mr Cole-Hamilton won the Edinburgh West seat by 2,960 votes ahead of SNP rival Toni Giugliano in the 2016 Scottish Parliament elections, which were held on May 5.
The Crown Office and Procurator Fiscal Service (COPFS) has concluded there should be no proceedings raised at this time following a “full and careful” look at the circumstances of the case.
There will also be no charges brought against an unnamed woman in relation to the alleged incident.
Mr Cole-Hamilton - who was general election campaign director for the party - said he was glad the matter is “closed”.
In a statement on Thursday, the MSP said: “Today, as I always knew they would, the procurator fiscal service confirmed to me that I have no case to answer in respect of allegations around my 2016 election campaign spending.
“While this has been a long process, I have sought to fully co-operate with the investigation at every stage.
“I did so, both in the knowledge that we had done nothing wrong but also because I believe that it’s vitally important for voters to retain faith in the integrity of individual election results and, by extension, the wider democratic process.
“Throughout all of this, my focus has never drifted from my efforts to represent the communities of West Edinburgh to the best of my ability. I love my job and I work hard at it.
“I’m glad this matter is closed and I’m grateful to the police and the fiscal service for their dedication in pursuit of the truth both in this case and in all that they do.”
The Scottish Liberal Democrats said previously that “everything was done by the book” and they had confidence there was nothing in the complaint.
A Crown Office spokesman said: “The procurator fiscal received a report concerning a 39-year-old male and 42-year-old female in connection with an alleged incident on June 7 2016 and, after full and careful consideration of the facts and circumstances of the case, has decided there should be no proceedings at this time.”