By Agence France-Presse
The office of the Hennepin County Attorney announced that an investigation of the allegations against Liu found the case had "profound evidentiary problems."
"As we reviewed surveillance video, text messages, police body camera video and witness statements, it became clear that we could not meet our burden of proof and, therefore, we could not bring charges," County Attorney Mike Freeman said in a statement.
Freeman said the case was typical of many other sexual assault investigations in that Liu maintained the sex was consensual.
Liu -- the 45-year-old billionaire founder of Chinese e-commerce juggernaut JD.com -- was arrested in Minneapolis on August 31 while he was in the US as part of a PhD program in business administration offered by the University of Minnesota.
He was accused of rape by a 21-year-old female student who had dinner with him and a group of others prior to the alleged incident.
Among the evidence investigators reviewed was body camera video from police officers who initially talked with Liu and the alleged victim, according to the prosecutor's office.
The cameras captured portions of conversations in Mandarin between Liu and the woman, the prosecutor said.
"As is the case in many sexual assault incidents, it was a complicated situation," Freeman said.
"Because we do not want to re-victimize the young woman, we will not be going into detail."
Forbes estimates Liu's worth at $5.5 billion, a fortune derived from his 15 percent stake in JD.com.