Media regulator Ofcom has rejected police claims that a Channel 4 programme was distorted.
Channel 4 aired the Dispatches show in January
The programme, Dispatches, tackled claims of Islamic extremism and featured preachers at various mosques.
West Midlands Police and the Crown Prosecution Service said the programme was heavily edited and distorted what the preachers were saying.
But Ofcom said it found no evidence the broadcast, Undercover Mosque, had misled its audience.
In a statement it said the one-hour documentary shown in January, was a legitimate investigation, uncovering matters of important public interest.
"Ofcom found no evidence the broadcaster had misled the audience or that the programme was likely to encourage or incite criminal activity.
"On the evidence (including untransmitted footage and scripts), Ofcom found the broadcaster had accurately represented the material it had gathered and dealt with the subject matter responsibly and in context."
The programme featured a reporter going undercover to reveal extreme and anti-democratic views being preached in British mosques - one of which was Green Lane Mosque in Birmingham - and within Islamic organisations which claimed to be mainstream.
Andy Duncan, Channel 4 chief executive, said Ofcom's judgement vindicated the channel's strong defence of the programme.
"We have maintained all along the comments made by certain speakers in the film spoke for themselves and this ruling confirms that."
Kevin Sutcliffe, the channel's deputy head of news and current affairs, said his team had carried out a rigorous investigation for the programme, conducted over nine months.
All the preachers featured were offered a right to reply and none of the individuals complained to Ofcom about the way they were represented, he said.
"In these circumstances it seems perverse that Hardcash (the programme's producers) and Channel 4 should have found themselves the subject of a police investigation.
"West Midlands Police acted in a calculated fashion - they made no attempt to discuss their concerns about the film with us in advance of going public with their complaint to Ofcom knowing that an allegation of 'fakery' would generate significant media interest.
"Their action gave legitimacy to people preaching a message of hate to British citizens... and damaged the reputations of those involved in producing and broadcasting the programme," he added.
West Midlands Police said it acknowledged Ofcom's findings.
It said it had had a number of complaints from people about the programme which led it to carry out an investigation.
The Crown Prosecution Service said there was insufficient evidence to bring charges against anyone, but it did raise concerns about the production of the programme.
"West Midlands Police considered this and subsequently a referral to Ofcom, as the independent and experienced regulator was made," it said.