The European Court of Human Rights ruled Tuesday that Ukraine's detention of former prime minister Yulia Tymoshenko was unlawful, in a decision the opposition leader's camp saw as a key step towards her release.
Tymoshenko herself said she hoped the decision by the Strasbourg-based court would put paid to the "dirt and black lies" against her.
"The court considered that the detention had been arbitrary and unlawful during the entire period," the judges said.
The European Union is mulling a trade and association accord with the ex-Soviet republic and has clearly said it wanted Kiev to release the charismatic Tymoshenko.
Her daughter described the court's decision as a "first victory" and her lawyer argued that her nemesis President Viktor Yanukovych now had no option but to release her.
Tymoshenko, who has rejected the charges against her as politically motivated, welcomed the ruling in a statement from jail.
"I am happy all the dirt and black lies the authorities have been drowning me in over the past years have been removed," she said, asserting that the court had "de facto" acknowledged her as a political prisoner.
"After the decision of the European court I am already morally free. Free despite all their bars, cells, walls, fences and tinted windows," she said.
The judges also found that the Ukrainian judiciary had not properly reviewed the legality of her detention and that she had no possibility to seek compensation.
However they threw out a complaint over alleged ill-treatment during her transfer to hospital last year.
Tymoshenko, who lost a disputed presidential election to Yanukovych in 2010, was jailed for seven years on what she says are trumped-up charges of overstepping her authority while premier to sign a gas deal with Russia.
Western governments have condemned her jailing as the result of selective persecution by the authorities and it has led to a sharp deterioration in ties with the European Union, which Kiev wants to join.
"I urge President Yanukovych not to appeal this decision and to instead follow this ruling. The only thing left to do now is to free Mrs Tymoshenko immediately," her lawyer Sergiy Vlasenko said.
"The president is afraid of Mrs Tymoshenko because she is the only politician capable of defeating him in any election. That's why she is in prison," he said.
The European Union hailed the ruling, calling on Kiev "to reconsider thoroughly the situation of Ms Tymoshenko ... who remains detained after a trial that did not respect fair, transparent and independent legal proceedings."
French foreign ministry spokesman Philippe Lalliot also called for Tymoshenko's release, reiterating that legal moves against her were "unfair and politically oriented".
"Today we are saying that this is the first victory, the first step to her full political rehabilitation and her immediate release," said Yevgenia Tymoshenko, the daughter of the 52-year-old opposition leader.
"The president on the basis of the court ruling has every opportunity to release my mother," she said. "We hope that he will make this humane decision in the nearest term."
Kiev has three months to appeal the ruling but the European Commission is set in May to make a recommendation on whether the bloc should sign the association agreement with Kiev.
Yanukovych earlier this month unexpectedly pardoned Tymoshenko's close ally and former interior minister Yuriy Lutsenko who had been jailed in a hugely controversial embezzlement case.
However the president has so far shown little inclination to make a similar gesture to Tymoshenko, noting that her appeals process has not been exhausted and she is involved in a murder case.
The fiery 2004 pro-democracy Orange Revolution co-leader has since her conviction seen other legal troubles pile up, including a separate trial on tax evasion and embezzlement charges while head of Ukraine's main power utility in the 1990s.
Worse, she has also been charged with involvement in the 1996 gangland-style shooting of Ukrainian lawmaker Yevgen Shcherban.