A British court ruled on Tuesday that restricting the liberty of terrorist suspects violated their human rights, turning down a government bid to uphold the contentious powers.
The Court of Appeal upheld a lower court's ruling that the government's "control orders" were a violation of suspects' rights.
UK Home Secretary John Reid called control orders "an essential part of our fight against terrorism" and said he would appeal to the country's highest court.
High Court judge Jeremy Sullivan last month quashed orders restricting the freedom of six men who were suspected of being threats to national security, ruling that the orders breached European Convention on Human Rights guarantees against indefinite detention without trial.
The six, who cannot be identified for legal reasons, are Iraqi nationals who sought asylum in Britain. They were arrested under anti-terrorism laws but released without charge.
A panel of three appeals court judges, headed by Lord Chief Justice Phillips, agreed that the control orders "amounted to a deprivation of liberty."
The judges upheld Reid's appeal in the case of a seventh man, a British citizen identified as M.B., overturning the High Court's ruling that a control order breached the suspect's right to a fair hearing.
Control orders -- which are part of tough anti-terrorism measures introduced by Prime Minister Tony Blair's government -- allow some suspects to be held under strict bail conditions that resemble house arrest.
The orders have been condemned by civil libertarians as well as repeatedly challenged in the courts.
The orders imposed on the six men required them to remain indoors for 18 hours a day.
"Such a restriction makes most serious inroads on liberty, even giving that word its most narrow meaning," the judges said in their ruling.
The judges refused permission to appeal, but Reid can ask the House of Lords -- the country's highest court -- to allow it.
Reid said he had "reluctantly" drawn up less stringent control orders against the six men in order to comply with the ruling.
He added that the new orders were "not as stringent as the security services believe are necessary."
"We are at a sustained high level of threat from a terrorist attack -- put simply, an attack is highly likely," Reid said.
"Our security services are at full stretch and control orders form an essential part of our fight against terrorism," he said.