The murder conviction of Welsh van driver Timothy Evans will not be sent to the Court of Appeal.
Notorious serial killer John Christie confessed to the murders
Mr Evans was hanged in 1950 for killing his one-year-old daughter and was also charged with murdering his wife. He was pardoned in 1966.
At his trial, Mr Evans said serial killer John Christie, who also lived at 10 Rillington Place, London, carried out both murders.
His family's solicitor said it was "outrageous" that the Criminal Cases Review Commission would not refer the case.
The commission said the free pardon in 1966. with its publicity of Mr Evans' case as a miscarriage of justice, was "sufficient to establish his innocence and to restore his reputation."
Mr Evans was convicted on 13 January 1950 of murdering his baby daughter Geraldine in November of the previous year.
The 25-year-old had also been charged with murdering his wife Beryl, but that charge was not pursued after the first conviction.
But it was three years before Christie emerged as a notorious serial killer and 1966 before Mr Evans was pardoned.
Both had been strangled in a bath house at an address that would a few years later become notorious with murder: 10 Rillington Place.
At his trial, Mr Evans, who was originally from Merthyr Vale and had a low IQ, maintained his innocence.
He claimed that Christie, who had lived at the same address, was responsible for both murders.
But Mr Evans was convicted by a jury, and sentenced to death. An appeal was dismissed and he was hanged on 9 March 1950.
It was not until almost three years later that Christie's crimes were uncovered.
The remains of Christie's wife Ethel and those of five other women were found in the house.
At his trial, Christie admitted that he had murdered Mrs Evans and later indicated that he may have been responsible for murdering Mr Evans' daughter.
Mr Evans was finally granted a free pardon on the recommendation of the home secretary in October 1966.
However, this did not formally erase his conviction and Mr Evans' family applied to the commission in August last year for a review of his conviction.
The commission said although there is a "real possibility" that the Court of Appeal would not uphold the conviction, it would exercise its discretion not to refer.
It said a referral to the appeal court, even if it resulted in the quashing of the conviction, "would bring no tangible benefit to Mr Evans' family, the public interest or the criminal justice system."
But this was dismissed by Mr Evans' family solicitor, Bernard de Maid, who said the decision was an "outrage."
He said: "This decision goes against everything the commission was set up for in the first place. This is a cast iron miscarriage of justice and the case would walk through the Court of Appeal, the cost would be minimal."
Compensation for Mr Evans' surviving sisters is still being finalised.