The Court of Appeal has ruled that the bedroom tax discriminates against a domestic violence victim and the family of a disabled teenager.
The ruling followed legal challenges by a woman who has a panic room in her home, and the grandparents of a 15-year-old who requires overnight care. The UK Government said it will appeal against the decision.
The "bedroom tax" was introduced in April 2013. Since then families claiming housing benefits have been assessed for the number of bedrooms they need. Families deemed by their local authorities to have too much living space have received reduced payments.
In Scotland the SNP Government mitigates the Bedroom Tax with £38 million of support each year to ensure no-one has to pay it here.
One appeal - brought by a woman identified only as "A" - concerned the impact of the policy on women living in properties adapted because of risks to their lives. Her home was equipped with a panic room. Rebekah Carrier, a solicitor acting for "A", said:
"Our client's life is at risk and she is terrified. The anxiety caused by the bedroom tax and the uncertainty about this case has been huge."
The second appeal - brought by Pembrokeshire couple Paul and Susan Rutherford and their 15-year-old grandson Warren - focused on the impact of the policy on disabled children needing overnight care. The ruling would affect only people within these two specific groups - severely disabled children needing overnight care and victims of domestic violence living in specially adapted accommodation.
There are believed to be about 300 victims of domestic violence that this applies to and thousands of severely disabled children in this situation.
"A" and the Rutherfords both claimed that the policy discriminated against them unlawfully.
Lord Chief Justice Lord Thomas, Lord Justice Tomlinson and Lord Justice Vos, sitting in the Court of Appeal, allowed both appeals, on the grounds that the "admitted discrimination" in each case "has not been justified by the Secretary of State".
Mr Rutherford said he was "absolutely delighted" with the ruling, adding: "I couldn't have had a better start to the day. It was so unfair. Somebody had to do something to get the law changed."
Michael Spencer, from the Child Poverty Action Group, said the ruling meant families "can stay in their homes safe in the knowledge that their disabled children can get the care they need".