Sheila Bowler, 67, was released on bail pending a retrial - probably before the end of the year - at which the new evidence will be heard.
Lord Bingham, the Lord Chief Justice, sitting with Mr Justices Mantell and Dyson, ordered the retrial after hearing that the original jury was not given the chance of considering the possibility that Florence Jackson, 89, may have died by accident.
Mrs Jackson, an aunt of Mrs Bowler's late husband, drowned in the River Brede, near Rye, Sussex, in May 1992.
Mrs Bowler has always claimed that Mrs Jackson wandered away from their car while she was away seeking help for a burst tyre. However, she was charged because police did not believe the elderly woman would have been able to walk to the river, 500m away. They said Mrs Bowler pushed her in.
An initial appeal was rejected in 1995 but Michael Howard, the Home Secretary, later referred the case back to the court after reviewing the evidence from experts who believe Mrs Jackson could have fallen into the river by accident. Lord Bingham said: "Our system provides for trial by jury and a jury has not been asked to consider whether in the light of all the evidence in the case, including evidence for and against the accident hypothesis, it is sure of the appellant's guilt."
The judgement was greeted with applause from the public gallery, while Mrs Bowler put her face in her hands and shook her head.
Lord Bingham said yesterday's decision did not represent criticism of the trial judge, Mr Justice Garland, the original Court of Appeal hearing, or those who conducted Mrs Bowler's defence at trial.
The appeal judges rejected an application by Jeremy Roberts QC, Mrs Bowler's counsel, to reject the re-trial option on the basis of the amount of time that had passed and on humanitarian grounds.
"This is a lady who would like to go home and will not be going anywhere else until the retrial," he said. However, the Crown did not oppose bail, allowing Mrs Bowler to be released from Holloway prison, north London, where she has been serving her sentence.
After the hearing, Mrs Bowler's children, Jane and Simon, were allowed into the cells at the High Court to congratulate their mother before all three emerged, wiping their eyes and hugging.
"I'm enormously relieved at the outcome of [the] hearing," said Mrs Bowler. "I want to thank all the hundreds of members of the public, and other friends and complete strangers who have helped me. It's great to be out and to have this chance to prove my innocence.
Her daughter, Jane, said: "We are delighted that mum will be coming home."Reuse content