The former speaker of the Bosnian Serb parliament was found guilty of persecution, extermination, murder, deportation and forced transfer.
Krajisnik is one of the highest ranking Bosnian Serb politicians to be convicted by the tribunal over the 1992-1995 Bosnia war, in which some 200,000 people died.
However the verdict was met with outrage from Bosnian victims' groups who said they were shocked Krajisnik was acquitted of genocide.
The judges concluded that although Krajisnik was part of a joint criminal enterprise aimed at driving Muslims and Croats out of parts of Bosnia, and there was some evidence that genocidal acts did take place, it could not be proved that he had intended to commit genocide.
Judges verdict
The 61 year-old Krajisnik, a close ally of fugitive Bosnian Serb wartime leader Radovan Karadzic, "knew about and intended mass detention and expulsion of civilians", the judges said.
"Mr Krajisnik wanted the Muslim and the Croat population moved out of Bosnian Serb territory in large numbers and accepted that a heavy price of suffering, death and destruction was necessary to achieve Serb domination and a viable statehood."
Krajisnik his face dominated by his greying brows and shock of grey hair, listened to the verdict without emotion.
In the early years of the war, Bosnian Serb forces launched widespread attacks on Bosnian Muslim and Bosnian Croat villages, killing many people and forcing the remainder to leave.
They also set up detention camps where thousands of non-Serbs were held in inhumane conditions and subjected to torture and rape.
Victims outrage
"The sentence is a major blow to justice. It is an insult for the victims," said Bakira Hasecic, who heads a victims association called Women -- Victims of War.
In 1992 Hasecic was raped by Bosnian Serb troops and expelled from Visegrad, one of the towns featured in the indictment against Krajisnik.
Sulejman Tihic, the Muslim chairman of Bosnia's tripartite presidency, said the verdict "partially served justice".
"I hope that the prosecutor will appeal the verdict and that Krajisnik will be found guilty of genocide in a final judgment," Tihic, who went through Serb-run detention camps during the war, said in a statement.
The prosecution had asked for a life sentence for Krajisnik. The prosecution's spokesman, Anton Nikiforov, said they would study the verdict before deciding if they would appeal.
Krajisnik maintained his innocence throughout the trial and said he was not aware that any crimes had been committed. His defence had asked for acquittal on all charges.