Manchester United fanzine Red Issue has been cleared by police after thousands of copies were seized a fortnight ago.
The edition of the fanzine included a poster on the cover of a Ku Klux Klan hood along with the words "LFC" and "Suarez is Innocent".
The publication was reacting to the ongoing race row involving Luis Suarez, who was banned for eight matches for racially abusing United defender Patrice Evra.
"I have decided that no further action will be taken in relation to allegations surrounding the publication and distribution of the Red Issue fanzine at Old Trafford football ground on February 11, 2012," said Nazir Afzal, Chief Crown Prosecutor for the North West.
"During the investigation into the matter by Greater Manchester Police, the issue of potential incitement to racial hatred was raised.
"As a result, I consulted the CPS's Special Crime and Counter Terrorism Division, who are responsible for advising on suspected cases of incitement.
"Following this consultation, I have received advice from a senior lawyer in that division that, although the fanzine distributed may have been offensive to some people, there was insufficient evidence to prove that the content was intended to stir up racial hatred, or that it was or likely to do so."
Red Issue was first published in 1989.
Liam Apicella
