Corrie died in 2003 from injuries suffered when she was run over by an Israeli military bulldozer in the Rafah region of Gaza. She was protesting the demolition of homes in the region as a volunteer for the International Solidarity Movement.
Richard Falk, a U.N. special envoy on Palestinian human rights, formally condemned the Israeli decision to block a lawsuit filed by Corrie's family.
"The judge's decision represents a defeat for justice and accountability and a victory for impunity for the Israeli military," he said in a statement.
Israeli officials said the Rafah region was an active combat zone. A judge ruled the situation was regrettable but said Corrie knew the risks associated with her protest.
A lawyer for the state said after the session the driver of the bulldozer couldn't see Corrie. Falk's statement noted that witnesses said Corrie was in the line of site of the driver and was wearing a fluorescent orange vest at the time of the incident.