The 19-year-old Briton was said to be the victim of a gang assault in a hotel room in which 12 people took part. Police on the island arrested 12 Israeli teenagers and detained them on a court order. But after no evidence of DNA linking them to the incident was found five were released on Thursday and the remaining seven were let go today.
A police source told Reuters: “Rape never took place.”
The youths had denied raping the woman nearly two weeks ago.
Three of the men had admitted to having sex with the woman and insisted it was consensual.
A police spokesman in Nicosia said: “A 19-year-old woman has been arrested on suspicion of making false allegations.”
She is due to appear in court on Monday.
Yiannis Habras, a lawyer representing four of the Israelis, said investigators concluded her account “didn’t stand to reason”.
He said his clients wanted to pursue civil actions against the woman.
Israeli lawyer Nir Yaslovitzh, who is representing three men, told the Associated Press the group are due to return to Israel on Sunday.
He said: “As I claimed all along throughout the entire process, there was no rape in Cyprus, and now the youngsters who embarked on a vacation that turned into a nightmare will return home as early as today.
“They will all go back to their homes and families.
“The Cyprus police conducted a professional and thorough investigation.”
Israeli Education Minister Rafael Peretz, told reporters on Sunday: “We need to check the details. We are certainly in favour of the children of Israel having the highest moral standard.”