DAR ES SALAAM (Reuters) -Tanzania has freed the leader of the main opposition party, Freeman Mbowe, after prosecutors dropped terrorism charges brought against him last year, his party said on Friday.

       Mbowe, who is the chairman of Chadema party, was detained last July in the lakeside town of Mwanza where he was due to attend a conference on proposals for a new constitution.

       He was charged in court on July 26, in spite of protests from his party that the charges were politically motivated.

       "The director of prosecutions has dropped charges of economic crimes and terrorism," Chadema said on its Twitter feed. Three co-accused were also freed, the party said.

       Mbowe's supporters, who had flocked into court to follow the trial, cheered after the decision to drop the charges was announced, while his lawyers hugged each other.

       His detention and trial had raised questions about President Samia Suluhu Hassan's commitment to greater tolerance for political dissent.

       Hassan, who took over after the death of her predecessor John Magufuli in March last year, lifted a ban on four newspapers and met the exiled top opposition leader in Brussels last month, stirring hopes of greater tolerance for political dissent.

       Government officials deny accusations of rights violations and stifling democracy.

       "Today's dismissal of the case against Freeman Mbowe is a welcome opportunity for Tanzania to turn the page and focus on the future," said Donald Wright, the U.S. ambassador to Tanzania.

       (Writing by Duncan Miriri;Editing by Raissa Kasolowsky)