Hudson-Odoi, 19, was arrested on suspicion of rape on May 17 before being released on bail. Police officers and an ambulance were called to his apartment after a report of an unwell woman.
A police statement read: "A man arrested on Sunday, May 17 following an allegation of rape has been released with no further action."
Hudson-Odoi made a public statement on the situation for the first time on Saturday: "At a time where there are bigger things happening in the world right now, you may also be aware of serious allegations that were made against me," he wrote on Twitter.
"I have stayed silent and assisted the police fully throughout their enquiries, as I knew the day would soon come when my name would be cleared.
"Following a full and thorough investigation, the police have now confirmed they will take no further action.
"I have learned that being a footballer and playing for one of the best clubs in the world comes with a great responsibility, and going forward I will try and use my platform as a Chelsea player to be the best role model that I can be."
Chelsea have made no comment on the incident.
Frank Lampard's side return to Premier League action with a trip to Aston Villa on June 21.
Information from Reuters was included in this report.