RWE npower hoped to build 19 turbines up to 127 metres high on common land at Mynydd y Gwair, Felindre, near Swansea.
Swansea Council rejected permission for the project and was backed by a planning inspector.
But a judge has now ruled the firm's original appeal against the decision should be reconsidered.
On Friday Mr Justice Beatson concluded a judicial review by saying the then environment minister had accepted the recommendations of a planning inspector to reject the appeal on the grounds of its impact on an important habitat of peat bog.
The judge ruled that the original reasoning was deficient.
However, he also rejected a separate claim from RWE npower Renewables over proposed changes to common land in the area.
Swansea councillors rejected the Mynydd y Gwair scheme in January 2010 on the grounds that the turbines were 27m higher than guidelines for the area.
Mynydd y Gwair was identified as a suitable location for a large-scale wind farm due to its strong and persistent winds.
At that time Swansea council's planning committee said its visual and landscape impact was unacceptable and the proposed route for construction traffic was inadequately justified.
But the council had taken more than a year to reach this decision and in October 2009 RWE started the appeals process on the basis the decision was taking too long.
The Welsh Government rejected the appeal in February this year and the firm then decided to seek a judicial review.
The Welsh Government and RWE npower have been asked to comment.
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