The government policy requiring landlords to check the immigration status of tenants had been branded racist by rights groups.
The scheme was rolled out in England in 2016 but has not yet been introduced in Scotland, Wales or Northern Ireland.
Research by the Residential Landlords Association, which helped bring the case to court, said 44% of landlords were less likely to rent to people without a British passport as a result of the scheme. The government said it was"disappointed" in the ruling and noted it had been granted permission to appeal.
"We are disappointed with the judgment and we have been granted permission to appeal, which reflects the important points of law that were considered in the case," a spokesperson said.Mr Justice Spencer said Right to Rent was incompatible with the right to freedom from discrimination, enshrined in the European Convention on Human Rights , and had"little to no effect" on controlling immigration.
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