MINNEAPOLIS (Reuters) - No charges will be brought against Archbishop John Nienstedt, leader of the Roman Catholic Archdiocese of St. Paul and Minneapolis, who was accused by a boy of inappropriately touching his buttocks during a group photo session, prosecutors said on Tuesday.

Prosecutors found "insufficient evidence" to charge the archbishop after an extensive St. Paul police investigation into the allegation, the Ramsey County Attorney's Office said in a statement.

Nienstedt, who had denied any inappropriate contact, stepped aside in December while authorities investigated the accusation. He is resuming all public duties, the archdiocese said after prosecutors dropped the case on Tuesday.

"While I look forward to my return to public ministry, I remain committed to the ongoing work needed to provide safe environments for all children and youth," Nienstedt said in a statement.

The accusation against Nienstedt became public at a time of growing criticism of the archdiocese's handling of cases alleging sex abuse by clergy members. It followed a court-ordered release by the archdiocese of names of priests it said had been credibly accused of child sex abuse.

Prosecutors said a broad police investigation into the handling of child sex abuse allegations within the archdiocese remains active.

Richard Dusterhoft, criminal division director for the Ramsey County attorney, said in a memo declining charges that the file was reviewed by an assistant county attorney experienced in prosecuting child sex abuse cases, who determined the "case could not be proven beyond a reasonable doubt and should not be charged."

Dusterhoft said a male juvenile told his mother Nienstedt had touched his buttocks during a group photo in May 2009 after a confirmation service. She later told a friend over lunch who happens to be a priest what her son had said and the priest reported it to the archdiocese and to police, Dusterhoft said.

Police interviewed the accuser, Nienstedt and everyone in the photograph, Dusterhoft said. No one reported being touched, seeing anyone touched, or seeing anyone react as though something had happened, he said.

The accuser told police Nienstedt's hand moved down his back to his buttocks, but he did not feel violated, was concerned about the attention the incident was receiving and did not believe it was significant, Dusterhoft said.

(Reporting by David Bailey; Editing by Mohammad Zargham)