Helen Steel and David Morris, known as the "McLibel Two," were sued by the corporate giant in the 1990s after they distributed campaign leaflets called "What's wrong with McDonald's."
The pair were refused legal aid and forced to defend themselves in a 314-day trial, the longest in English legal history.
The European Court of Human Rights ruled the pair did not receive a fair trial as guaranteed under the Human Rights Convention, and their freedom of expression had been violated by the 1997 judgment, which ordered them to pay damages of $107,000, reduced on appeal to $71,000. The award is now moot.
The case reportedly cost McDonald's $18 million.
Speaking to reporters outside a London McDonald's, Steel said: "Hopefully the government will be forced to change the (libel) law and that will mean greater freedom of speech."
A spokesman for the Department of Constitutional Affairs said the judgment would be studied very carefully.