AF is one of three test cases which went to the House of Lords
A terror suspect has been released from a control order because ministers did not want to reveal secret intelligence at public court hearings in his case.
Home Secretary Alan Johnson released the suspect, known as AF, after a major legal battle over secret evidence.
The order was imposed because the authorities alleged AF was associated with an extremist Libyan organisation.
The decision is the latest blow to the counter-terror control order scheme and controversial secret evidence rules.
Control orders restrict the freedoms of some terror suspects and can include house-arrest style conditions, including curfews and restrictions on working, studying and communication.
Last June the Law Lords said the control orders imposed against AF and two other suspects were unfair.
The court said that the suspects had not been allowed to know enough of the case made against them to properly defend themselves in open court.
The Law Lords ruling was prompted by a European Court of Human Rights decision on secret evidence - and has led to widespread predictions that the control order system will unravel.
In the case of AF, who has dual British-Libyan nationality, Mr Johnson decided to lift the order rather than place more secret information in the public domain.
At the time of the Lords' ruling, Mr Johnson said he would vigorously contest each control order case.
The type of information that may have been subject to disclosure would have included secret material gathered by MI5.
There are long-standing rules governing the disclosure of secret evidence because of the risk of compromising sources or revealing how information is gathered.
Solicitor Carl Richmond told BBC Radio 4's World at One programme that AF, who had been confined to his home for up to 16 hours a day as a result of the order, felt numb.
Mr Richmond said that he would now seek to have the order formally quashed in the High Court at a hearing in October or November.
AF was born in 1981 to a Libyan father and English mother and lives in the Manchester area.
British authorities said he had links to members of the Libyan lslamic Fighting Group, an extremist organisation opposed to Colonel Gaddafi.
The decision to rescind AF's order comes days after another controlee, who took the original European Court action on secret evidence, was allowed to leave the UK for good.
According to the latest available figures, there are about 20 control orders in force, but lawyers for many of the suspects are pushing for fresh hearings.
Overall, about 40 people have been held on control orders over the four years they have been in force.
The Home Office declined to comment on the case, but security minister Lord West told Parliament earlier this year that officials would have to go through each case and that some orders would be rescinded.