Stuart Cheevers was found not guilty of causing the death of 87-year-old Catherine Lennon by careless driving at Liverpool Crown Court.
A jury took just an hour and a half to acquit 26-year-old Cheevers, of Shaws Road, Southport, and he was discharged from the dock.
The court heard during the two day trial that the victim was struck by his Renault in Union Street on February 23 last year as he was reversing into a space and she died about three weeks later in hospital.
Motorist Christopher Ganner saw Mrs Lennon, who used a stick, starting to cross the road and he came to a halt to let her pass in front of him. She stopped in the middle of the road as a silver Renault was coming the opposite way and after it passed she continued on her way.
Mr Ganner told the court that the car stopped and he realised it was going to reverse park. "The lady proceeded to carry on walking to the other side of the road and the car started to reverse into the parking space.
"I assumed she wasn't going to make it past the car in time and I came to almost a stop. I saw her disappear behind the vehicle, obviously hit by it. I ran over to see if she was okay as did the driver and passenger of the other car," he said.
Anya Horwood, prosecuting, alleged that Cheevers had not used the requisite care when reversing.
But Cheevers, denied the charge, and told the jury that he had checked his mirrors while reversing and had not seen the victim.
He said he would have stopped to let her cross as the road was too narrow to have got past her. "I would not have been able to pass comfortably, I would have 100% stopped.
"I am not going to stand here and lie about what I did," he said.
Cheevers explained that where he used to live was near several schools and where he now lives was only two minutes away from a school. Whenever he backed into his drive he always checked carefully because there were "kids everywhere."
He said that he had thought about the incident "millions and millions of times and the only thing I can think is that she was behind parked cars and that is why I did not see her."
By Lynda Roughley