The announcement by Judge Hassan Abdullah set off scuffles in the courtroom between defense attorneys and the plaintiff's lawyers and relatives of those killed in the January 25 uprising, Ahram Online reported.
Muslim Brotherhood lawyer Abdel-Moneim Abdel-Maqsoud said the decision was "positive," noting the judge had acquitted 21 top Mubarak-era defendants in a similar case.
Civil rights lawyer Amer Ahmed Saad also applauded the judge's decision. Citing the same earlier case, Saad said, "we feared he would not be impartial and that his presence would affect the trial's fairness."
Mubarak is being retried for his role in killing protesters during the January 2011 revolution. His two sons, Alaa and Gamal Mubarak, also are being retried on charges of financial corruption.
The former minister of interior, Habib El-Adly and six of his aides are being retried for their role in the deaths of protesters.
An appeals court in January ruled Mubarak and his co-defendants could appeal the verdicts in the initial trial because of procedural irregularities.
The Cairo Appeal Court will now set a new date and judicial district for the retrial.
The country's current political instability has taken the Egyptian public's focus away from the trial, the BBC reported, particularly after a report leaked last week charged the army was responsible for the killing and torture of protesters during the uprising that toppled Mubarak.