A spokeswoman for the court in Stuttgart said Kretschmer's father, a 51-year-old businessman, would instead face prosecution for enabling his son to get access to his weapons cache, along with ammunition.
But there were not sufficient grounds to charge him with negligent homicide, as prosecutors in the state of Baden-Württemberg had previously planned.
Last March, Tim Kretschmer, 17, used his father's 9mm Beretta pistol in a school shooting rampage that left nine pupils and three teachers dead, mostly with execution-style shots to the head. A further three people lost their lives in a dramatic chase and shoot-out with police before, cornered, Kretschmer turned the gun on himself.
State prosecutors charged Kretschmer's father in November with 15 cases of negligent homicide and a further 13 cases of negligently causing injury, on the grounds that he had left the gun and ammunition unsecured in his bedroom. He legally kept more than a dozen weapon in the family home.
But the Stuttgart court has now ruled that negligent homicide and injury charges could be considered only if the father's conduct had directly caused the massacre.
The court decided it could not rule out the possibility that Kretschmer would also have committed the crime if the gun, magazine and ammunition had been properly secured in the weapons cabinet. There was substantial evidence that Kretschmer knew the security combination to the cabinet, it said.
A date for the trial on lesser charges had not yet been set.