The Iraq Historic Allegations Team (Ihat) has decided not to proceed in 57 cases, the MoD said.
A further case was stopped by the military's prosecuting authority.
The news follows a call by PM David Cameron to "stamp out" what he called "spurious" legal claims against British troops returning from  action overseas.
Ministers had been asked to draw up plans to curb claims, including by restricting "no win, no fee" arrangements, Mr Cameron said.
Lawyers say no-one is above the law, and many abuse cases have been proven.
Ihat was set up to review and investigate allegations of abuse made by Iraqi civilians against UK armed forces personnel in Iraq during the period of 2003 to July 2009.
It currently lists more than 1,300 allegations under investigation, ranging from murder to low-level violence.
Conservative MP Richard Benyon, a member of the Commons Defence select committee, said innocent veterans were being unfairly targeted.
He told The Sun: "It's an intolerable burden for people who have served their country well to face this knowing they're innocent."

The MoD said the partnership could mean more intelligence is shared about the latest cyber threats.
Defence companies face cyber-attacks almost daily, often from countries seeking to steal sensitive information about new technology and weapons.
Officials say they hope the plan will serve as a model for other sectors.
The new Defence Cyber Protection Partnership - a joint effort between the UK government and nine large defence companies - is designed to improve the industry's collective defences against cyber-attacks.
It will also work to establish higher standards of security for smaller companies in the supply chain.
Cyber-attacks are one of the top four threats to UK national security alongside international terrorism, according to the government's National Security Strategy.
Earlier this month, UK intelligence service GCHQ said Britain was seeing about 70 sophisticated cyber-espionage operations a month against government or industry networks - some 15 of which were against the defence industry.
GCHQ director Sir Iain Lobban said business secrets were being stolen on an "industrial scale" and in some cases foreign hackers had penetrated firms for up to two years.
In 2010 the British government designated the protection of computer networks as one of the country's most important national security priorities.
It pledged Â£650m of new investment over the next four years to continue tackling the problem as part of its National Cyber Security Programme.
In March, the government launched the Cyber Security Information Sharing Partnership to help businesses and government share information on cyber threats, including a secure web portal to allow information to be shared in real-time.

Gatlin beat Jamaica's Asafa Powell - who ran 9.94secs - with fellow American Tyson Gay third in 9.98secs.
Former Olympic champion Gatlin, 34, who led from the blocks, heads the Diamond League 100m standings after also winning in Shanghai earlier this month.
Femi Ogunode, fastest man in the world this year, was fifth in 10.02secs.
Great Britain's Laura Weightman came sixth in the women's 1500m.
Weightman, 24, clocked a time of four minutes 03.04 seconds in a race won by Kenya's Faith Kipyegon in 3:56.41.
Britain's Tiffany Porter, 28, finished seventh in the women's 100m hurdles behind winner Kendra Harrison.
American Harrison finished in 12.24secs, a new American record and the second fastest time in the history of the event.
In the women's high jump at the event in Eugene, Britain's Isobel Pooley, 23, finished eighth after clearing 1.88 metres.

The 24-year-old was scheduled to play seven group games, but will now undergo elbow surgery without making an appearance in the competition.
The club will instead give their young players a chance to feature.
"We are looking forward to seeing how the young players go when given an opportunity," head coach Chris Silverwood said.
"As a club we are renowned for investing in youth and we will continue to do so to improve their experiences over the remaining matches of the campaign. Giving them opportunities now will only help them in the future."
Meanwhile, bowling coach Donovan Miller has left the club for Caribbean Premier League side Jamaica Tallawahs.
Miller played club cricket in the Middlesex, Essex and Hertfordshire leagues from 2000-2012, while completing his coaching qualifications.
"I am delighted to be joining the Tallawahs. I have put a lot of effort in over the years to ensure I keep getting better as a coach," he said.
Former England one-day wicketkeeper Paul Nixon is Tallawahs head coach.
Investigations into nearly 60 allegations of unlawful killing against UK soldiers in Iraq have been dropped, the Ministry of Defence says.
[NEXT_CONCEPT]
The UK's defences against cyber attacks are to be strengthened under new plans that will see the Ministry of Defence working with its biggest contractors.
[NEXT_CONCEPT]
Justin Gatlin ran his fastest time of the year to win the 100m at the Prefontaine Classic Diamond League meeting in Oregon in 9.88 seconds.
[NEXT_CONCEPT]
Essex will not replace injured New Zealand international fast bowler Adam Milne in their T20 Blast squad.