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The court ruling came a week after Mugabe, who ruled for nearly 40 years, was ousted by a military intervention.
“There is no evidence that he (Mawarire) urged a violent removal of government,” high court judge Priscilla Chigumba said in her ruling.
The judge said Mawarire had called for non-violent protests in response to the country’s economic crisis.
Mawarire became the face of anti-Mugabe demonstrations last year when he posted an internet video of him wearing the national flag and lamenting Zimbabwe’s troubles.
The video inspired the ThisFlag movement that led mass protests across the country.
Authorities responded by banning street protests in Harare and what they deemed “abuse” of the national flag.
“The whole journey has been absurd,” Mawarire told reporters afterwards.
“I should not have been in the dock at all. I should never have had to spend 11 months trying to defend myself from exercising my constitutional rights,” he said.
“One hopes that as our country changes and begins to move forward that things like this should never ever be allowed to happen.”
He warned Zimbabwe’s new President Emmerson Mnangagwa, a veteran from the ruling ZANU-PF party, against stifling people’s rights.
Mnangagwa came to power after the military seized control and people took to streets demanding Mugabe step down, with ZANU-PF lawmakers also turning against him.
“If they do to us what Robert Mugabe’s government did to us, we will do the same thing to them,” Mawarire said.
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