Ami Denborg told reporters the testimony of her brother-in-law, British businessman Shrien Dewani, would have been the only way for her family to learn the truth about what happened the night her sister Anni was killed.
Dewani walked free in Cape Town Monday after a shock judgement by Judge Jeannette Traverso cleared him of murdering his 28-year-old wife during their South African honeymoon.
The decision in what became known as the "honeymoon murder" case left Dewani's mother weeping with relief in court, while his late wife's family wept bitter tears.
Prosecutors said Dewani hired hitmen to kill 28-year-old Anni in a staged hijacking in a Cape Town township during their honeymoon in November 2010 because he is gay and felt trapped into marriage by family pressures.
Dewani says he is bisexual and loved Anni.
Traverso said the state's evidence had "fallen far below" the level needed to secure a conviction, and it would be unjust to force Dewani to testify in his own defence.
The judge conceded there were "a number of unanswered questions" about the murder, and acknowledged the "strong public opinion" that Dewani should take the stand.
Traverso also noted a plea by the murdered woman's family that Dewani should not be allowed to walk free without testifying, but said her ruling was based on law and could not be influenced by emotion.
Anni's family criticised the decision in an interview with Britain's Sky News Monday.
"It is a disappointment to all our family," Denborg said.
"We don't really care if he's innocent or guilty, we just want to know what happened to Anni. The only way we could have found out… was to actually hear Shrien under court examination, under oath, telling his version of events on the night."
If Dewani was bisexual, she added, "maybe he shouldn't have got married to her".
Brother Anish Hindocha added: "We only heard half the story."
Earlier, speaking to an international media scrum on the steps of the high court, Denborg said: "Justice failed us".
The ruling is a blow to the reputation of South Africa's state prosecutors, coming after a lengthy and costly battle to extradite Dewani from Britain after the murder.
It also follows their failure to secure a murder conviction against Paralympic sprinter Oscar Pistorius at his equally sensational trial earlier this year for shooting dead his girfriend.
Prosecutors told AFP they cannot appeal, and Dewani, 34, was expected to leave South Africa as soon as possible.
Anni was killed with a single shot, execution style, prosecutors said, after the hijackers allowed Dewani out of the vehicle and drove off with her.
Dewani said in his statement that he had offered 15,000 rand ($1,300) to the taxi driver to arrange a private helicopter tour of Cape Town as a surprise for his bride.
Prosecutors never got the chance to cross-examine Dewani on why he was willing to pay an unknown taxi driver so much in cash to organise a trip that could have been handled by his top-class hotel.
Taxi driver Zola Tongo and one of the hijackers — both serving long jail terms for the murder — told the court that Dewani hired them for 15,000 rand to kill his new wife.
The judge said evidence given by Tongo that implicated Dewani was "highly improbable".
Shrien Dewani leaves the court in South Africa after being acquitted. Photo: AP
The family has said Anni would not have married Dewani if she had known of his sexuality.
In a written statement to the court, Dewani admitted to sex with male prostitutes but said he considered himself bisexual.
The court also heard that Anni sent Dewani desperate emails just days after their lavish wedding ceremony in Mumbai questioning his "feelings" for her.
"I don't want an insecure man or a man whose feelings doesn't come naturally that you have to force yourself," Anni wrote on November 5, 2010.
She was killed eight days later.
Shrien Dewani is expected to fly back to the UK on Tuesday.