William Chapman, 18, was fatally shot on April 22.
Police responded to a shoplifting call at a Walmart, after which the officer approached Chapman, according to Jon Babineau, an attorney for the teen's family.
There was a struggle between the officer, who has been fired, and Chapman before the shooting, according to a witness.
"The guy charged at him -- like took two steps toward him to come fight him, so the cop opened fire," a witness told CNN affiliate WTKR.
Babineau told CNN last week, "The police officer had the ability to either step back or step aside. There's no evidence of lunging."
An autopsy report obtained by CNN shows that Chapman was shot in the face and chest. The shooting was ruled a homicide.
In addition to murder, Rankin is charged with use of a firearm in the commission of a felony.
Sallie Chapman, William's mother, told reporters that she felt "justified" by the indictment, even as she acknowledged nothing will totally ease her pain.
"We're going to always hurt," she said. "Even though he's been indicted and he might do some time, we're going to still hurt."
Rankin's lawyer: 'Facts do not support such a charge'
Responding to the indictment, Rankin's lawyer Nicole Belote said, "While I am quite surprised that a charge of first-degree murder was presented to the grand jury and returned as a true bill, because the facts do not support such a charge, it does not change our defense.
"We will continue to prepare for trial and zealously defend Officer Rankin."
Interim Police Chief Dennis Mook announced later Thursday that Rankin had been fired "in accordance with the Law Enforcement Officers' Procedural Guidelines."
"I am confident that the grand jury impartially weighed all the evidence presented before rendering their final decision," Mook said in a statement. "... I believe in our criminal justice system and the laws under which it operates."
Babineau called the indictment proof "that the criminal justice system continues to work" -- even in a case, like this one, where "you have a white police officer and a young black man (and it) often doesn't end well for the young black man."
"(This was a) premeditated murder of a young black man who was committing no crime and was murdered by a police officer," the lawyer said.
Chapman's mother said the grand jury's actions show that, "It (doesn't) matter if you're a police officer, that (doesn't) give you the right to do anything."
"All lives matter, and you had no right to take him away," she said of Rankin. "...You took a life, and now your life is gone."