Mohamad Ikraam Bahram, was fired upon by two Queensland Police officers in Mary Street in Brisbane's CBD at 10.09am on February 23, 2020.
Mr Bahram had minutes earlier arrived in the CBD by car and non-fatally stabbed a British tourist in the back with enough force to snap the blade.
State coroner Terry Ryan said he accepted a Joint Counter Terrorism report that found no evidence Mr Bahram's actions constituted a terrorist attack.
Mr Bahram's actions were likely indicative of a mental health episode from a person diagnosed with schizophrenia, Mr Ryan found.
Mr Ryan did not accept Mr Bahram had acted with the intent of ending his life.
After stabbing the tourist, Mr Bahram returned to his vehicle and retrieved a 30cm knife with a serrated blade.
Multiple people called triple-0 to report an assault and a man walking the streets with a knife in hand.
Two officers arrived in Mary Street in a marked police van with lights and sirens after responding to the calls.
Videos from the officers' body worn cameras showed Mr Bahram sprinting with a large knife in his hand directly towards a constable, who yelled at him to drop the knife several times.
When Mr Bahram did not comply, both officers fired their service-issued weapons, inflicting fatal injuries to his heart and liver.
In findings released last week, Mr Ryan said the officers acted proportionally to an armed and potentially active offender who had wounded a person.
"The evidence showed they only had a matter of seconds to respond to (Mr Bahram) when they arrived at Mary Street," Mr Ryan said.
"They were not aware of his background in terms of his mental health history and had to respond to the highly dynamic situation."
Mr Bahram's family had submitted to the inquest that police had mischaracterised the investigation as terrorism-related without clear justification, especially given their explanation about his mental health issues.
The family said their grieving had been disrupted and reputation damaged by the investigators' use of a search warrant to enter their home.
Mr Ryan said it was not unreasonable for law enforcement to exhaust all lines of inquiry into the motivation behind Mr Bahram's actions.
"The experience of having (Queensland and Australian Federal Police officers) in the family home in the immediate aftermath of (Mr Bahram's) death was distressing, particularly in terms of Islamic cultural practices," Mr Ryan said.
"However … the verbal communication with the family by officers during the execution of the search warrants was respectful."
Mr Ryan accepted Metro South Health, which had been treating Mr Bahram, had made improvements to its violence risk assessment and management system for mental health patients.
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