Lord Bramall has described the past year since being interviewed by police in connection with historic child sex abuse as "really awful".
The UK's former highest-ranking soldier was informed on Friday that he faces no further action as part of the Metropolitan Police's Operation Midland.
The 92-year-old peer, a Normandy veteran, was interviewed under caution last April at a police station close to his home near Farnham, Surrey.
The pensioner, who was not arrested, had always categorically denied the allegations.
He told the Times newspaper it had been an "awful" experience.
Lord Bramall, as Field Marshal Edwin Bramall, was head of the British Army during the Falklands War before being promoted to the top military post.
Operation Midland is part of a wider umbrella of investigations by Scotland Yard, dubbed Operation Fairbank, into allegations of abuse involving senior politicians and high-profile figures
The Met released a statement saying: "Officers working on Operation Midland have today, Friday 15 January informed a man in his 90's from Farnham who was interviewed under caution on 30 April, 2015 that he will face no further action.
"Following a thorough investigation officers have concluded there is insufficient evidence to request the Crown Prosecution Service (CPS) to consider charging the man with any offences."
Anthony Stansfield, the Police and Crime Commissioner for the Thames Valley who served as a platoon commander under Lord Bramall, strongly criticised the police investigation.
"This is a man who has commanded our nuclear deterrent, was in charge of all our armed forces," he told the BBC Radio 4 Today programme.
"He would have been surrounded by staff, he would have had a very, very detailed diary of every day. It is utterly inconceivable and the slightest investigation would have shown that.
"Instead they seem to have barged into the house of a 92-year-old. His wife was dying of Alzheimer's in the house - she subsequently died. The victim in this entirely is Field Marshal the Lord Bramall."