The Higher People's Court of Yunnan Province ruled that Qian Renfeng's confession was made under duress and that she was not guilty of the murder charge she was convicted for in February 2002.
Qian was working at a nursery where a toddler died of food poisoning and two other children were hospitalised.
Qian, who had prepared the children's meals that day, was forced into confessing that she had mixed raticide in the food. It was on the basis of this forced confession that she found guilty of murder.
The higher court in December last year quashed the sentence, ruling that it lacked sufficient evidence to determine guilt beyond reasonable doubt. She was exonerated and released, state-run Xinhua news agency reported.
Qian had filed for up to 9.55 million yuan (about 1.45 million US dollars) in damages.
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