The 37-year-old, from Trowbridge in Wiltshire, was arrested by West Midlands Police as part of an investigation into suspicious betting patterns in February of that year, conducted jointly by the police and the Gambling Commission.
However, the World Professional Billiards and Snooker Association (WPBSA) released a statement this morning which said no charges would be brought against Lee.
"The WPBSA has been informed by the Gambling Commission that the CPS will not be taking further action in relation to the match-fixing allegations against Stephen Lee, made in 2010. The Commission has decided not to commence criminal proceedings under the Gambling Act 2005.
"The WPBSA will now be allowed access to details pertaining to the enquiry in order to consider whether there has been a regulatory breach of the governing body's rules."
Lee's arrest was made under section 42 of the Gambling Act 2005, which states: "A person commits an offence if he (a) cheats at gambling, or (b) does anything for the purpose of enabling or assisting another person to cheat at gambling."
Lee, who is ranked sixth in the world, has five ranking tournament victories to his name, the most recent coming at the PTC Grand Finals earlier this year.