Ms Tymoshenko is best known for the charismatic and militant role she played in last year's protests that brought Viktor Yushchenko the presidency.
However, the woman known as the Princess of the Revolution has been battling to restore her credibility among Ukrainians since September, when Mr Yushchenko fired her and her government over personality clashes and internal squabbling. The dismissal damaged her chances ahead of parliamentary elections in March.
Ms Tymoshenko makes no secret of the fact that she would like to become the country's prime minister again, especially since her powers would be considerably greater after constitutional changes.
However, she has long been forced to defend herself and members of her family against allegations that they embezzled millions of pounds of taxpayers' money when she ran a state-owned energy company in the 1990s. According to Ms Tymoshenko the charges against her, her husband and her father-in-law have been dropped. "This finally brings this to an end," she said. "It is absolutely clear that none of these charges had any basis. It's absolutely clear that this was political repression."
The development comes just days before Ukraine marks the first anniversary of the country's Orange Revolution tomorrow and at a time when the former prime minister is reported to be in negotiations with Mr Yushchenko to forge a pact that would allow the revolution's original architects to set aside their differences. It also follows the closure of a criminal case against her in neighbouring Russia, in which she was accused of bribing state officials.
The Ukrainian criminal charges against her were first brought in 1995 and fresh charges were levelled in 2001 after she had a dispute with the former president, Leonid Kuchma, and was also ousted from his government.
She and other family members were jailed briefly on charges of bribery, money-laundering, corruption and abuse of power.
"We all suffered through this," said Oleksandr Tymoshenko, her husband, sitting alongside her.
Ms Tymoshenko and Mr Yushchenko were fêted as the heroes of the Orange Revolution but have since fallen foul of public opinion, with many people accusing them of hypocrisy, cynicism and being just the same as the corrupt politicians they replaced. Indeed, recent opinion polls suggest that neither of the "orange" blocs - Mr Yushchenko's or Ms Tymoshenko's - will win enough votes in the next election to form a majority on their own.
Ms Tymoshenko has said she hopes to form a coalition with Mr Yushchenko, but has insisted that she will not make any major concessions, such as yielding the prime minister's job.
However, the rival pro-Russian presidential contender whom Mr Yushchenko defeated last year, Viktor Yanukovych, has staged a remarkable comeback. Opinion polls indicate that 57 per cent of Ukrainians believe the orange promises have been broken and put Mr Yushchenko's Our Ukraine bloc on 13.5 per cent, with the Tymoshenko bloc on 12.4 per cent.
Remarkably both are trailing Mr Yanukovych's bloc, which leads the polls with 17.5 per cent.
Mr Yushchenko has said he will make Tuesday, the first anniversary of the revolution, a national holiday called "Freedom Day" and has called on his supporters to replicate the tent city they erected last year.
His plans are not to everyone's taste though. Hundreds of leftists waving Russian flags rallied in Kiev yesterday to condemn the idea.
"There is nothing to be proud of, we sold out our country," said Viktoriya Vasilenko, a protester.Reuse content