France's agriculture ministry imposed a ban in February 2008 amid concerns over public safety, but its decision had already been called into question by the European Court and has now been annulled by the State Council.
The State Council's ruling stated that the government had failed to prove that Monsanto crops "present a particularly elevated level of risk to either human health or the environment".
In September, the European Court of Justice ordered France to review its ban. Since then, the Council ruled, the French government had failed to present new evidence of the supposed dangers posed by the plants.
Agriculture Minister Bruno Le Maire, in a first reaction, said the government would "examine all options in order not to grow Monsanto 810 maize".
Le Maire said the ruling did not surprise him and that the government continued to be opposed to planting genetically modified crops as there were "still too many uncertainties about the consequences for the environment".
President Nicolas Sarkozy's government has said in the past that if the ban was overturned it would seek a new legal "safety clause" to restrict planting.
The environment ministry wants to halt planting of "genetically modified organisms that have not been evaluated for conformity to new EU rules or about which there is uncertainty about their potential environmental impact."
Environmental pressure group Greenpeace called upon the government to act quickly to put in place a new ban, fearing that the food industry might move to plant crops like Monsanto's MON 810 strain of pest-resistant maize.
"If the government does not act in putting in place a new ban, we could see GM crops back in our fields as early as next year," Greenpeace spokesman Sylvain Tardy claimed.
"Is that something Nicolas Sarkozy, very probably running for re-election, is ready to put up with, while French people remain against the idea of GM crops by a very large majority?" he demanded.
Monsanto markets MON 810 maize -- which has been modified at a genetic level to include DNA from a bacteria -- under the trade name YieldGuard as being resistant to insect pests that can threaten harvests.
But some governments believe it could pose a danger to plants and animals.