In July Mandla -- embroiled in a bitter family feud -- was charged with tampering with the graves of his famous grandfather's children, after he exhumed them without consent.
"We have decided to drop the charges of grave violation because of insufficient evidence," said Luxolo Tyali, the spokesman for the National Prosecuting Authority.
Mandla in 2011 dug up the remains of his father and two other children of the country's first black president Mandela.
The remains were shifted from the family graveyard in the southern village of Qunu -- where the global peace icon grew up -- to nearby Mvezo, where Mandla is the tribal chief.
They were returned and reburied in Qunu in July following a court order sought by members of his family.
Mandela's eldest grandson had also faced a long standing charge of bigamy, after his unceremonious separation from his first wife, Thando Mabunu, in 2008.
"After studying the police docket on this matter, we also decided not to prosecute," said Tyali.
The 39-year-old is also currently facing a charge of pulling a gun on a motorist during a road rage quarrel last month.
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