Five Labour members have won a court case against the party over new members' right to vote in the leadership election.
The Labour party has been given permission to appeal to the court of appeal, which will hear the case at 10:30 on Thursday.
The case was sparked after Labour's National Executive Committee decided that full members could not vote in the leadership election between Jeremy Corbyn and Owen Smith if they had not had at least six months' continuous membership up to July 12 - the "freeze date".
In order to vote members would have had to make a payment of £25 between 18 and 20 July. However, after the result all new members can vote on the outcome.
When the decision was made anti-Corbyn groups welcomed the decision, while those aligned with Corbyn, including Momentum, have said the changes were made to rig the election in favour of the challenger candidate.
After near 130,000 members were excluded, five new members brought the case forward, arguing that they would play an important role in the contest.
The five who brought the case accused Labour's National Executive Committee (NEC) of freezing them out of the monumental vote even though they had "paid their dues".
The statement from the claimant post-verdict said: "This judgement is a vindication that the political process should be fair, democratic and inclusive; that political parties, like any other organisation, must uphold its rules fairly to those who support them."
Smith said: "I have always welcomed growth of our party and wider movement. Now many more members will have the chance to vote in the leadership election, I am today calling for an extension of the timetable so that all members have the opportunity to engage with Jeremy and me before making their choice.”
Shadow chancellor John McDonnell, who is chairing Jeremy for Labour, said: "This is a huge victory for Labour party members and party democracy.
"The decision taken to freeze out new members since January was an affront to democracy and went against everything the party stands for.
"We are appalled by the possibility of an unnecessary and costly appeal. If it is taken forwards, the party will be using members money to try to stop members from voting. This is unacceptable."
It is thought that many members who joined the party since the general election last May did so to support Corbyn, meaning the decision is a blow to Smith's chances of victory.
Corbyn was already a strong favourite with bookmakers and pollsters, poised to win the election comprehensively.
Odds on a Corbyn victory haven't changed since the verdict, the frontrunner offered at 1/8 with Ladbrokes. That implies an 84 per cent chance of a Corbyn win. Betway have Corbyn even shorter, at 1/10.
The fallout stems from Labour MPs' lack of confidence in their leader following what was widely considered a lacklustre EU referendum campaign. Others are scared that he'd stand no chance in a general election and is not providing effective opposition to the government.
Ballot papers are set to be sent out on 22 August, with the result scheduled for 24 September.
Dr Stuart Thomson, head of public affairs at Bircham Dyson Bell, said: "The Labour leadership election is turning into a farce. The legal fights over the supposed party rules are overshadowing the policy discussions that are starting to take place."