Jurors watched the video during a four-day trial and deliberated two days before declaring they were solidly split about his guilt or innocence.
Prosecutors had the option of asking for a second trial, but Deputy District Attorney Matt Hubley instead sought to have the case dismissed.
Hubley said his decision was influenced by strong juror sentiment on both sides of the issue coupled with the fact that there was no new evidence to present.
"The motion to dismiss is granted," Commissioner Anthony Wheeldin told Wood, who stood beside his lawyer, Ben Adams. "The matter is over. Bail is exonerated."
Outside court, Wood, 34, an Army reservist, said he felt vindicated.
"Just because an officer has a badge doesn't mean he's always right," Wood said.
The 96-second video of police breaking into Wood's apartment and shooting him three times with electric stun guns sparked widespread community debate. One copy of the video posted on YouTube received 350,000 hits.
Some argued officers violated the sanctity of Wood's home while others said police had an obligation to check for domestic violence.
In the video of the May 10 incident, officers appear outside Wood's front window and ask to speak to someone inside. They were responding to a neighbor's report of a man yelling at a woman on a back patio, according to testimony.
Wood and his wife talk through the glass, indicating there is no domestic violence. A third occupant tells police they won't come out because "we don't live in a police state, sir."