"The Supreme Court ruled that the government's decision to terminate the head of the Shin Bet's tenure was made through an improper and unlawful process," the court ruling said.
In March, Prime Minister Benjamin Netanyahu decided to sack Shin Bet chief Ronen Bar, a move that sparked protests nationwide, with critics arguing that the government was undermining key state institutions and endangering the foundations of Israeli democracy.
Read moreIsrael government sacks Shin Bet intelligence chief
Israel's government said in late April it had cancelled its decision to fire Bar, a day after he announced he would stand down following weeks of tension with Netanyahu.
Bar's case against his sacking brought out conflicting testimonies of events leading up to the October 7, 2023 Hamas attack on southern Israel, which sparked the war in Gaza.
In his affidavit to the court, Bar said the Shin Bet had alerted Netanyahu's security apparatus just ahead of the Hamas attack early on October 7.
"Nothing was hidden" that night, Bar said.
(FRANCE 24 with AFP and Reuters)