The Law Lords are set to rule on whether controversial counter-terrorism control orders breach human rights.
The Law Lords have ordered the government to reconsider control orders imposed on eight terrorism suspects.
The ruling comes after two years of legal challenges to a system likened to house arrest.
But they did not declare the controversial anti-terrorism measure to be completely unlawful.
The case could force the Home Office to come up with an alternative system to deal with terror suspects whom ministers say cannot be prosecuted.
In rulings on nine individuals, the Lords said control orders which included 18-hour curfews, restricting someone to their homes, were too long.
Recent figures show 14 people were subject to control orders, half of them British - and three were on the run.
The lords ordered the courts to rethink two cases because the proceedings had breached a right to a fair hearing.
The control order system was introduced in March 2005 after the Law Lords said indefinite detention without trial of some foreign national suspects breached human rights.
Control orders aimed to get around that major ruling by severely restricting the freedoms of British and foreign suspects, without imprisoning them.
Curfews and control
Under the system, the Home Office can impose daily curfews, restrictions on whom a subject can meet and where they are allowed to go.
THE KEY CASES MB: British man in South YorkshireJJ and others: IraqisAF: UK/LibyanE: Tunisian Key cases profiled
The conditions can include being electronically tagged and bans on using telephones and the internet. Some controllees must call in to security officials at irregular hours to prove they are at home.
Lord Carlile, the government's independent reviewer of terrorism law, has described some of the orders as falling "not very far short of house arrest".
But ministers say the orders were necessary in cases where intelligence from the security service show an individual poses a threat to national security - but evidence cannot be presented in court.
This includes secret allegations gathered by MI5 from intercepting phonecalls or from other sources.
Nine cases
The Law Lords are ruling on control orders taken out against nine men since the start of the regime. In each case the men say the orders either unfairly restrict their right to liberty or their right to a fair trial under normal criminal proceedings.
In August last year the home secretary suffered a major defeat when the Court of Appeal quashed some of the key orders, saying that they were too restrictive.
However, in some of the cases before the Lords, judges have backed ministers, saying that the human rights arguments do not outweigh national security concerns.
The most recent Home Office figures showed that 14 people, eight of them British, were the subject of control orders.
Three of those 14 had absconded. Four others have absconded and are no longer officially counted because their orders lapsed while they were on the run.
The Home Office says the control order regime is a critical plank of its counter-terrorism policy.
If the lords rules against key elements of the system, ministers are expected to try to create a replacement system which could include withdrawing from elements of international human rights law.
