A large portion of the peloton were involved in a mass crash after Jumbo Visma rider Tony Martin collided with a sign which was being held onto the road by the fan.
The 30-year-old woman was detained by Landernau police overnight after handing herself in and fined 1,500 Euros.
Tour de France race organisers had previously threatened legal action against the woman but today decided to drop the charges in an attempt to deescalate the situation.
"We are withdrawing our complaint. This story has been blown out of proportion but we wish to remind everyone of the safety rules on the race," Tour director Christian Prudhomme said.
"If you come to the Tour, you hold your kid, you hold your pet and don't cross the road carelessly. And above all, you respect the riders - they're the ones worthy of live TV."
However, the woman may not completely avoid legal action for her actions with Movistar rider Marc Soler considering taking her to court after the crash forced him to prematurely exit the Tour de France with serious injuries.
“I don’t know what to do, I’m thinking of taking the spectator to court because that’s an entire Tour canned and I feel very angry,” he said.
“But the Tour is even worse because it wasn’t just a race incident, it was because of a spectator who obviously doesn’t like cycling.”