Amanda Knox sentenced to 28 years 6 months for murder for Meredith Kercher
It is the third time American Knox, 26, and Italian national Sollecito, 29, have faced trial over the death, in Perugia in 2007.
Neither defendant was in the courtroom as the verdict was announced, though Sollecito had attended the lengthy hearings. Members of Miss Kercher's family were there to hear the verdict.
The co-accused were originally found guilty of murder in 2009, and were handed jail terms totalling more than 50 years.
They were cleared nearly two years later - but the appeal court ordered a fresh trial in March last year.
Today, after lengthy deliberations, the court heard that both were guilty.
It is unknown whether the duo will appeal the decision, or whether Knox could be extradited from the US to Italy.
Rudy Guede, a drug dealer, is serving a 16-year sentence over the death - though the courts have said he did not act alone.
Miss Kercher, a 21-year-old Leeds University student from Coulsdon, Surrey, was found with her throat slashed in the bedroom of the house she shared with Knox in Perugia, central Italy, in November 2007.
Prosecutors claimed that Miss Kercher was the victim of a drug-fuelled sex game gone awry.
Knox and her former boyfriend Sollecito have consistently protested their innocence and claim they were not even in the apartment on the night Miss Kercher died.
Knox was convicted of the murder in December 2009 along with Sollecito following a high-profile trial, with Knox sentenced to 26 years in prison and Sollecito 25.
The pair were later cleared in 2011 after an appeal court found the prosecution lacking and criticised large swathes of the case against them.
Italy's highest criminal court, the Court of Cassation, ruled last March that an appeal court in Florence must re-hear the case against Knox and Sollecito for the murder.
Knox, who now lives in Seattle, said she would not attend due to being unable to afford to travel to Italy and remained in the US for the duration of the retrial.
Knox was given a sentence of 28 years and six months, and Sollecito - who has had his passport withheld - received a 25-year term.
Speaking outside the court, Knox's lawyer, Luciano Ghirga, said she will launch an appeal against the decision.
But he said the telephone line "went dead" as he told his client of the verdict.
Mr Ghirga said: "For those that, like me, are convinced that Amanda is innocent, it is a very difficult time.
"We have to respect the verdict but we will challenge them.
"We're very sad at the moment.
"We will definitely try everything. This is not the final word.
"I am very upset by this decision.
"We continue to be brave, we have plenty of courage.
"The road to the next appeal is quite difficult but we are ready for a new battle."
Sollecito's solicitor, Giulia Bongiorno, said she had not spoken to her client yet.
She said: "He was prepared for any outcome. He is totally astonished why the court keeps changing mind in this way.
"The court gives credit to rumours.
"This is not a surprise. They (Knox and Sollecito) have always been considered the murderers."
Miss Kercher's brother Lyle, who was in the court for today's verdict, said he would not be able to forgive those responsible for his sister's death.
In an interview with Sky, Mr Kercher said: "I think you'd have to be a very strong-willed - arguably religious - person to find that forgiveness.
"I think it is so easily forgotten what happened to Meredith.
"When I read reports even now, I find myself skimming past the paragraphs that refer to what actually happened to her because it is so horrific.
"I think anybody would just need to read in detail or know what happened to her to then question themselves - could they ever forgive someone who did that to their sister or daughter?"
Speaking after the verdict, Mr Kercher said: "No matter what the verdict, it was never going to be a case of celebrating anything.
"That's probably the best we could have hoped for."
In a statement issued by Knox, read by Sky News, she said she was "frightened and saddened by this unjust verdict".
She said the grief of the Kercher family "will follow them forever" and said they "deserve respect and support".
The statement went on: "I am frightened and saddened by this unjust verdict, having been found innocent before. I expected better from the Italian justice system.
"The evidence and accusatory theory do not justify a verdict of guilt beyond a reasonable doubt. Rather nothing has changed. There has always been a marked lack of evidence.
"My family and I have suffered greatly from the wrongful persecution."
Knox said this has "gotten out of hand".
"Most troubling is that it was entirely preventable," she said.
She described the investigation as "prejudiced and narrow-minded". She said there was an "unwillingness to admit mistakes", and added that there was a "reliance on unreliable testimony and evidence".
Knox said there was a "character assassination" as well as "inconsistent and unfounded accusatory theory", along with "counter-productive and coercive interrogation techniques that produced false confessions and inaccurate statements".
She added: "Clearly a wrongful conviction is horrific for the wrongfully accused, and it is also terribly bad for the victim, their surviving family and society."