Rights groups welcomed the move
Malaysia's parliament on Thursday repealed a law against "fake news" introduced this year by the administration of former prime minister Najib Razak.
Najib's government secured a simple majority in April to pass the Anti-Fake News 2018 bill, which set out fines of up to $123,000 and jail of up to six years.
Critics denounced the law as repressive and accused Najib of trying to curb free speech ahead of a May general election as his government tried to fend off criticism over accusations of graft and mismanagement.
Najib lost the election to an opposition alliance led by former premier Mahathir Mohamad, who had promised to scrap the law.
Parliament debated a motion to repeal the law for about three hours before passing it by a simple voice vote.
Rights groups welcomed the move.
"This is a law that was clearly designed to silence criticism of the authorities and to quell public debate – it should never have been allowed to pass in the first place," Teddy Baguilat, a board member of Asean Parliamentarians for Human Rights, said in a statement.
Co-opted by US President Donald Trump, the term "fake news" has become part of the standard repertoire of leaders in authoritarian countries to describe media reports and organisations critical of them.
Malaysia was among the first few countries to introduce an anti-fake news law although other countries in the region, including Singapore and the Philippines, have said they are considering how to tackle "fake news."
Germany approved a plan last year to fine social media networks if they fail to remove hateful postings.
Mahathir was himself accused of fake news after authorities said they were investigating him over what they said were false claims that his plane was sabotaged ahead of the election.
Other leaders who were opposed to Najib were also charged under the act.