The full evidence "should have been given to the jury at the time of trial. Let them have it now," Common Pleas Judge Rose Marie DeFino-Nastasi said, as the defendants' families burst into applause.
The Pennsylvania Innocence Project spent thousands of hours on the case, which they called a prime example of the problems with eyewitness identification not corroborated by other evidence.
Both men were 16 when a restaurant owner was fatally shot leaving work in 1995, and 18 when they were convicted by a jury that twice said it was deadlocked.
The eyewitness in the window, the daughter of victim Thomas Keal, contradicted herself several times, the judge found. She told police in 1995 that the man she saw with a shotgun was light-skinned, but at trial said he was the dark-skinned suspect. Both looked about 26, and were at least 6 feet tall, she said.
Gilyard is 5-foot-8, and Felder 5-foot-6.
"We can't have these inconsistencies in a case based solely on identification," said DeFino-Nastasi, who ruled Tuesday after several days of testimony in July.
The new evidence includes a 2011 confession from a man now serving life in another slaying. Innocence Project investigator Shaina Tyler obtained the confession during a prison interview, along with new details about the weapon and the crime that checked out, appellate lawyers David Rudovsky and Jules Epstein argued.
Philadelphia prosecutors said the man who confessed was offered $10,000 by supporters, and had nothing to lose given his life sentence.
"Their family and friends didn't tell the truth at the (summer evidence) hearing," Assistant District Attorney Laurie Williamson argued. "They're hiding something. They're hiding a lot."
But the judge said the confessor was a named suspect from the day of the crime, and said he also acknowledged on prison phone calls that the defendants weren't involved. She said he also never got the money, despite the confession, which he later recanted.
The case also pits brother against brother.
Kenyatta Felder testified this year that his brother, Lance, was not the getaway driver - because their older brother was. The older brother invoked his Fifth Amendment right not to testify at the July hearing, and no longer returns phone calls from siblings, a sister said.
"It's only me and my three brothers. So it's definitely hard," Sandra Felder, 30, said of the conflict.
The District Attorney's Office has 30 days to decide whether to appeal. The office has taken that step in two other recent cases in which murder convictions - and death sentences - were overturned by a city or federal judge.