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.
Amanda Knox has been found guilty again of murdering Meredith Kercher.
The verdict was read out by the judge and caused some confusion.
But we can confirm that both Knox and Sollecito are guilty.
The judges are now re-entering the room.
The courtroom has stood to attention.
A verdict is imminent.
It looks like the jury and judges could be about to return to the court room.
The doors into the courtroom have opened. Everybody in the room suddenly fell silent once the door was opened by a court official.
Stay with us.
The courtroom is now packed full of journalists, family members and lawyers.
Deliberations have been going on now for more than 11 hours.
Amanda Knox is believed to be watching the verdict on TV from her home town of Seattle, Washington.
We have expected a verdict all afternoon.
Journalists were initially told it would be at 5pm local time. But we now expect it will happen at 9.30pm local time, or 8.30pm GMT.
The fact that Ms Kercher's family are now seated in the courtroom indicates that a verdict could be imminent.
The verdict is expected within the next 30 minutes.
The family of British student Meredith Kercher have arrived in court for the hearing.
Judges will decide whether Amanda Knox and her ex-boyfriend Raffaele Sollecito murdered Ms Kercher.
Unlike Britain, Italy has three different verdicts: guilty, not guilty and innocent.
A not guilty verdict means accused are still viewed with suspicion although there is not enough evidence to convict.
Stay with us for live updates as they happen.
The case has played out through the media as much as through the courts, propelling Knox and Sollecito to something approaching celebrity status in their home countries.
Armies of bloggers battle over disputed evidence about the case online.
Supporters of Knox in the United States have done much to transform an initial public image of her as a sex-obsessed party girl, which critics say prevented a fair trial, to one portraying her as a victim of a faulty justice system.
Knox has lived in her US home city of Seattle since her 2011 release and has not returned to Italy to hear the verdict, saying she will remain a "fugitive" if found guilty.
But Sollecito, dressed in a smart coat with sunglasses despite the pouring rain, attended with his family.
Lawyers for Sollecito and Knox argue that Rudy Guede is the only person is guilty of the murder.
His trial found that he did not act alone because of the number and variety of Kercher’s more than 40 wounds.
The court has the power to detain Sollecito immediately if he is judged a flight risk, but Knox would need to be extradited to serve any sentence.
Knox’s lawyer Carlo Dalla Vedova raised his voice in anger as he urged the judges not to feel they had to protect the reputation of the Italian justice system, following allegations from the United States that a flawed system led to Knox being wrongfully dragged into the case as a suspect.
He said: "Judges, we cannot send two innocent people to jail to ... protect the dignity of anyone we heard in this process.
"What about the dignity of the accused, who spent four years in jail? The dignity of the family? The victim?"
He dismissed Knox’s initial testimony to police, in which she falsely implicated Congolese bar owner Patrick Lumumba in the crime and described hearing Kercher scream, as the result of police manipulation, confusion and her lack of Italian language skills.
The prosecution maintains her initial testimony proves she had knowledge of the crime, and has asked for an additional four years of jail for Knox for a standing slander conviction for implicating Lumumba.
Lawyers for Knox today urged a Florence court to find her and her former Italian boyfriend Raffaele Sollecito innocent of Meredith Kercher's murder as judges retired to decide a verdict.
In final statements to the panel of two judges and eight jurors, defence lawyers asked them to disregard DNA traces that originally helped convict the two, saying errors by investigators meant they could not be relied upon.
Traces of DNA on a knife found in Sollecito’s apartment and on Kercher’s bra clasp, as well as footprints from the crime scene, have been poured over in the latest trial.
Two of Meredith’s family, sister Stephanie and brother Lyle, are expected to arrive for the verdict.
Stephanie had earlier told a local Italian newspaper that, while the verdict was an important date, the family was not expecting it to be "a source … of truth".
Meanwhile Knox confirmed she would be in Seattle with her mum and family and that it would be her lawyer would inform her of the outcome.
Speaking to Italian TV through Skype she maintained her innocence.
She said: “The proof is in the facts. There is no proof that I was there when this happened. I remember Meredith as a person who gave me friendship from the very beginning.
“If I am convicted I understand that I will be seen as a fugitive but I will continue to fight until the end.”