The taxi driver linked to the murder of Mildred Odira, a 32-year-old switchboard operator for Foresight Company based at Nation Centre, has been released.
David Junga Ochieng, the only suspect in the case, was freed after senior state counsel Christine Mbevi said police did not have sufficient evidence to charge him with murder.
When the case was mentioned on Wednesday, Ms Mbevi informed Kiambu Chief Magistrate Patricia Gichohi that that police will now treat Mr Ochieng as a possible prosecution witness.
The magistrate allowed the prosecution to close Mr Ochieng's investigation file and ordered the return of the Sh200,000 cash bail he deposited.
Ms Odira was last seen leaving her home in Kariobangi South, Nairobi, on January 29.
Security guards called a taxi to take her to Ruaraka's Uhai Neema Hospital after she fell ill that night.
Her body was found at City Mortuary on February 4, with a wound on the forehead, another on the cheek, a cut on her abdomen and fractured legs.
The state of her underwear indicated that she might have been raped.
A post-mortem showed she was hit by a blunt object on the head and other parts of her face before being abandoned on the side of a road.
When Ms Odira's family questioned him, the taxi driver said he dropped Ms Odira at the hospital and left after about 10 minutes.
Later in February, police said they were looking into the possibility that she used another means of transport from Uhai Neema after Mr Ochieng dropped her off at the gate.
Contrary to previous reports that she did not alight from the taxi, footage extracted from cameras outside the hospital showed she got out outside the gate before the driver went through it and made a U-turn.