The lurid accusations were made by Fairfax Media newspapers The Sydney Morning Herald, The Age and The Canberra Times in a series of stories in January last year.
They claimed the all-rounder exposed himself to team masseuse Leanne Russell in a dressing room at the 2015 World Cup in Sydney and "indecently propositioned" her.
Gayle denied the allegations, saying the journalists behind the story wanted to "destroy him".
His teammate Dwayne Smith, who was in the changing room at the time, also denied the incident took place.
A NSW Supreme Court jury ruled in Gayle's favour, finding Fairfax was motivated by malice.
The media group had defended the articles on the basis the allegations were substantially true and in the public interest.
"At the end of the day I'm very, very happy," Gayle said after the verdict, according to the Herald, adding that coming to court had been "very emotional".
"I'm a good man. I'm not guilty," he said.
The publication of the stories followed an uproar after Gayle attempted to flirt with an Australian presenter on live TV, asking her out for a drink and telling her: "Don't blush, baby."
During the week-long hearing, a tearful Russell stood by the allegations, saying she had gone to the room looking for a towel and came across Gayle.
She alleged he lowered the towel he was wearing and asked: "Are you looking for this?"
Gayle's close friend Donovan Miller told the hearing that since the allegations the West Indian had become "scared, especially (around) females and he always feels someone is out to get him".
A hearing on damages will be held at a later date.
First Published: October 30, 2017, 1:22 PM IST