Police arrested Cassez in 2005 for involvement in a kidnapping group called the Zodiacs. Her Mexican boyfriend was the head of the organization, authorities said, though Cassez denied she ever committed a crime.
The panel of justices said Wednesday the staged televised arrest of Cassez in 2005, one day after her actual arrest, was a violation of her rights to due process, the Los Angeles Times reported.
Judge Alfredo Gutierrez Ortiz Mena said the staged arrest for the benefit of television crews counteracted the presumption of innocence.
"Respect for human rights is the only way to justify the punitive power of the state," Judge Arturo Zaldivar added.
Cassez's imprisonment has put a strain on relations between the French and Mexican governments. The French government had repeatedly urged Cassez's release, but some say Mexican President Felipe Calderon refused to release her because his administration wishes to appear tough on crime, the Journal said.
Angry Mexicans took to Twitter Wednesday over their frustration with the ruling.
"Incredible, the liberation of the French woman," tweeted Maria Esteva. "The message: Kidnap, torture, kill ... it doesn't matter, you'll get off free."