The South African department of environmental affairs had sought to retain a moratorium on domestic trade in rhino horns which was dismissed last year by another court.
While the ruling makes it legal for rhino horns to be traded in South Africa, it will have no impact internationally because a UN ban on international trade is still in force.
"We've been following this case and we are very concerned that the Minister's appeal was simply dismissed on a technicality," explains Jo Shaw, the head of the rhino program for WWF South Africa. "The concern is that this could open a mechanism to allow laundering of the so-called blood horn from poaching into this legal trade."
Not everybody was displeased by this news.
The court action was initiated by private rhino ranchers and other associations. They say they need to sell horns to afford spiralling security costs.
"If you look back to the original ban introduced in 1997, ask yourself one question. Has it worked?" says Pelham Jones, the chairman of the Private Rhino Owners Association.
"No it hasn't. It has been a terrible failure. Moratoriums and bans do not work because there's always a way to circumvent them. We have to look to ways and means for a sutainable solution."
South Africa is home to around 20,000 rhinos which constitutes 80 per cent of the world's population. About a third of it is held by private breeders.
Breeders' orginisations say legalising horn trade is the only way to stop poachers.
But conservationists have expressed concerns that local buyers could also illicitly supply markets in Vietnam and China.
"What we're looking at here is the domestic trade of rhino horn in South Africa, yet there isn't a market for horn here,"Jo Shaw. "It's not really a logical argument."
"When they talk about laundering, they don't know what they're talking about," replies Pelham Jones. "All of our horns will be locked away in silos and until international trade is allowed they won't leave the country."
The South African government has so far only said they would put out a statement on the matter. According to the Reuters news agency, it also reminded "that permits are still required to sell or buy rhino horn".
"The South African government needs to be vigilant, as does the International community, so as to make sure rhino horns aren't traded out of South Africa through other countries and then entered in China and Vietnam," warns David Newton, Regional Director for East and Southern Africa at TRAFFIC.
The number of rhinos poached in South Africa went down by 10 per cent in 2016. But activists warn the number of animals killed, which was more than 1000, still remains high.