Damien Utan, from suburban Melbourne, was cleared during a hearing in Frankton Magistrates Court on Monday.
Prosecutor Kevin Bond had told the court the 18-year-old threatened to kill a fellow student who was tormenting him in a letter to Manson.
But Utan's lawyer, Liz Gaynor, told the court the boy never intended to hurt anybody.
He wrote to Manson at his California prison, she said, because he was being bullied at school and saw Manson as a figure of strength.
In the letter he simply expressed the desire Manson should escape and kill everyone at his school, Gaynor said. But he did not seek advice on how to kill his fellow student and never stated any intention to kill anyone.
Several of Utan's classmates testified Monday that he had been the victim of bullies and was picked on because he was considered a devil worshipper, the students said.
Still incarcerated in the United States, Manson led a murderous cult in the 1969 "Helter Skelter" murders.
His most famous victim was the American actress Sharon Tate who was pregnant with filmmaker Roman Polanski's baby at the time of her death in her home in the hills above Los Angeles.
The murders were dubbed the "Helter Skelter" murders because Manson, who called himself "AKA Lord Krishna, Jesus Christ, Mohammed, the Buddha" during a 1986 parole hearing, claimed he had been inspired by the Beatles song of that name.