Ms Taylor, 26, a hospital worker, was shot multiple times as officers stormed her home on 13 March.
Brett Hankison has been charged, not with Ms Taylor’s death, but with “wanton endangerment” for firing into a neighbour’s apartment in Louisville.
Two other officers face no charges.
Assistant Chief of Police Robert Schroeder said the officers conditions are not life-threatening.
He added that a suspect is in custody.
A state of emergency has been declared in Louisville and the National Guard have also been deployed.
Mayor Greg Fischer has set a 21:00-06:30 (01:00-10:30 GMT) curfew in the city for three day. He earlier said he had declared a state of emergency “due to the potential for civil unrest”.
What did the prosecutor say?
Under Kentucky law, someone is guilty of wanton endangerment if they commit an act that shows “an extreme indifference to the value of human life”.
This lowest-level felony offence can come with a five-year sentence for each count. Brett Hankison was charged on three counts.
Ms Taylor’s relatives and activists for whom her death has become a rallying cry had been calling for the three officers, who are all white, to be charged with murder or manslaughter.
But this was rejected by a grand jury that reviewed the evidence.
On Wednesday, Judge Annie O’Connell announced the charges that had been brought against Mr Hankison.
Kentucky Attorney General Mr Cameron then held a news conference in which he expanded on the decision. “This is a gut-wrenching emotional case,” he said.
“There is nothing I can offer them today to take away the grief and heartache as a result of losing a child, a niece, a sister and a friend,” he added in a message to Ms Taylor’s family.
Mr Cameron said a ballistics report had found that six bullets struck Ms Taylor, but only one was fatal.
That analysis concluded that Detective Myles Cosgrove had fired the shot that killed Ms Taylor.
The attorney general said it was not clear if Mr Hankison’s shots had hit Ms Taylor, but they had hit a neighbouring apartment. Media captionProtesters march in Louisville following the grand jury decision
The top prosecutor said the other two officers – Jonathan Mattingly and Mr Cosgrove – had been “justified to protect themselves and the justification bars us from pursuing criminal charges”.
Mr Cameron, a Republican who is the state’s first black attorney general, added: “If we simply act on emotion or outrage, there is no justice.
“Mob justice is not justice. Justice sought by violence is not justice. It just becomes revenge.”
What’s the reaction?
Ben Crump, a high-profile lawyer for the Taylor family, said the outcome was “outrageous and offensive”.
Officials this month agreed to pay her family $12m (£9.3m) in a settlement.
Asked for his reaction to the decision, Mr Trump told a White House news conference: “I thought it was really brilliant.”
He praised Kentucky’s attorney general, who addressed the Republican party convention last month, for “doing a fantastic job”.
“I think he’s a star,” he said, adding that he approved of the Kentucky governor’s decision to send in the National Guard.
Governor Andy Beshear, a Democrat, urged Kentucky prosecutors to release the evidence that was presented to the grand jury.
“I think having more of the facts out there so people can see, people can truly process it, is where we need to be,” Mr Beshear told reporters.
What happened to Ms Taylor?
Shortly after midnight on Friday 13 March, she was in bed with her boyfriend, Kenneth Walker, when they heard a banging on the door.
Plainclothes Louisville police officers were carrying out a narcotics raid, and they used a battering ram to enter the property.
A judge had granted a warrant to search Ms Taylor’s home because investigators suspected a convicted drug dealer – her ex-boyfriend, Jamarcus Glover – was using the address to receive packages. She had no criminal record.
Officials say Mr Walker’s bullet struck a police officer, Jonathan Mattingly, in the leg – an injury for which he later required surgery.
The three officers returned fire, discharging 32 rounds, according to a ballistics report from the FBI.
The death of Breonna Taylor
Ms Taylor, who had also got out of bed amid the commotion, was shot and died on the hallway floor.
According to an arrest report, the officers had been granted a “no-knock” warrant, allowing them to enter the property without warning.
Source: BBC and News Agencies