Indonesian General Adam Damiri was the last of 18 suspects to appear in the special human rights tribunal, set up to investigate abuses committed during the 1999 East Timor independence vote.
Only five other suspects have been convicted - all of whom are still free pending appeals.
Analysts had therefore widely expected that the general would be acquitted, especially since the prosecution itself had requested that the charges be dropped due to lack of evidence.
Instead the court on Tuesday found him guilty of human rights violations and sentenced him to three years in jail.
Patrick Burgess, former director of human rights in the United Nations transitional authority in East Timor, is amazed at General Damiri's conviction.
General Damiri said he was very disappointed by the verdict
"This was the last of the trials to go ahead, it was the most senior of the Indonesian military officers charged, and the prosecution itself had said they didn't have enough evidence to convict him," Mr Burgess said.
The case of General Damiri - who in 1999 was commander of the region which at the time included East Timor - has been particularly controversial.
The indictment against him said he should have stopped the bands of armed militia who carried out the majority of the killings after the independence vote.
Tuesday's verdict was hailed by some legal rights activists, but Joaquin Fonseca, from the Timorese human rights group HAC, said he was disappointed that the general only got a comparatively short sentence.
"I don't think this is enough," he said.
"This is just more evidence that the whole exercise was window dressing. These people have committed serious crimes and gross human rights violations.
"In terms of serving as a deterrent, this does nothing, because the Indonesian army who have committed the same crimes over the years will not learn from this event."
But Indonesian foreign ministry spokesman Marti Natelegawa was quick to reject these claims.
"We have obviously heard continued concern about how the trial process has been carried out," said Mr Natelegawa.
"But it is, after all, a newly instituted process - unprecedented, not only in Indonesia, but probably in the region as well.
"I think it would be rather unfair to describe the 18 cases that have been brought to the trial as being unsatisfactory in their outcome."
More than 1,000 people died in the East Timor violence
The human rights court was set up to deflect pressure for an international inquiry into the East Timor violence, in which more than 1,000 people died.
At the beginning of 2000, the United Nations Security Council agreed not to pursue the possibility of international proceedings, to give Indonesia a chance to show that it could carry out its own justice.
The UN has since raised the possibility of setting up a war crimes tribunal for East Timor, like those held for Rwanda and the former Yugoslavia.
Ian Martin, the head of the UN in East Timor during the 1999 violence, says that such a tribunal is unlikely to be set up as the security council is too involved with matters in Iraq.
"I don't think it has an appetite (for an international tribunal) at all," he said.
"I'm afraid memories are very short, and the crimes that happened in East Timor are no longer a matter of great concern to the council".
But he added that, if the principles of international justice are to be taken seriously, then now is the time for the UN to step in.
"It's very clearly the responsibility of the UN to look at what happened in a territory for which it was exercising a very particular responsibility in 1999," he said.
General Damiri has said he will appeal the verdict against him, and some legal experts predict that the ruling will be quietly overturned by a higher court.
Meanwhile the general, like those convicted before him, remains free.