World football has been thrown into chaos after a court overturned
The ruling by the Court of Arbitration for Sport is a huge embarrassment to FIFA, whose ethics committee imposed the lifetime ban one year ago.
The 63-year-old Qatari has been not proven innocent by CAS, instead the appeal has been upheld on the grounds of insufficient evidence.
FIFA can bring fresh proceedings against Bin Hammam if the revamped ethics committee has any new evidence.
Bin Hammam always claimed the FIFA action against him was retribution for having challenged Blatter for the presidency, and hailed the decision but said he had no interest any longer in standing again.
He told BBC World Service: "I promise you I will not quit until I clear my name.
"I have one aim, one mission. one target and that is to clear my name and then I say goodbye."
Bin Hammam was found guilty by FIFA's ethics committee last year of paying bribes to
Bin Hammam is still subject to a 30-day temporary suspension by the Asian Football Confederation - the body of which he was president - which has been extended worldwide by FIFA.
The suspension followed an audit by Pricewaterhouse Coopers (PWC) that centred on contract negotiations and payments to and from AFC bank accounts during Bin Hammam's presidency.
He was alleged to have breached a number of AFC regulations including relating to gifts and bribery.
The PWC report, a copy of which has been seen by the
It also states in 2008 'significant payments (totalling
Sources close to Bin Hammam say the allegations are further attempts to tarnish his name.
The CAS panel made its decision by a 2:1 majority and said in its ruling there was no direct evidence to link Bin Hammam with the money's physical presence in
It also questioned why no attempt had been made to trace the banknotes that were photographed. FIFA had hired former FBI director
The CAS panel added that 'it is more likely than not that Mr Bin Hammam was the source of the monies' and that 'his conduct, in collaboration with and most likely induced by Mr Warner, may not have complied with the highest ethical standards that should govern the world of football and other sports'.
CAS stressed it was not finding Bin Hammam innocent but that the case was 'not proven'.
FIFA expressed its concern at the CAS ruling, and said all files will now be handed over to the new ethics committee, which will decide if any new action is to be taken against Bin Hammam.
It is almost a year to the day since FIFA's ethics committee found 63-year-old Bin Hammam guilty of conspiring to pay bribes and issued the lifetime ban.
He had been a growing force in international football and displayed his power by being influential in
Some observers had believed he was on course to defeat Blatter until, less than a month before the election, he was accused of paying around
Witnesses testified that after being addressed by Bin Hammam at a specially-arranged meeting in
The witnesses stated that former FIFA vice-president Warner had told officials afterwards the money had come from Bin Hammam. Warner resigned from FIFA a month later and refused to speak to investigators.
Blatter went on to be elected unopposed after Bin Hammam pulled out of the presidential race, though England
Former England player and manager