The Court of Cassation ruled Tuesday that an appeals court in Florence must re-hear the case against the American and her Italian-ex-boyfriend.
Italy's top court overturned the 2011 acquittal of American student Amanda Knox and her former boyfriend Raffaele Sollecito for the murder of Briton Meredith Kercher, and ordered a retrial.
Lawyers for Knox and her ex-boyfriend looked grim as they huddled with prosecutors and court officials to get details after the ruling was issued. Lawyers for the Kercher family said they had got what they wanted.
The decision by the Court of Cassation is a new twist to a long-running case whose initial handling was sharply criticized by independent forensic experts.
Prosecutors accused Knox and Sollecito of killing Kercher in 2007 during a drug-fuelled sexual assault.
The two were initially found guilty and sentenced to 26 and 25 years in prison respectively after a trial that grabbed headlines all over the world.
In 2011, their convictions were overturned after forensic investigators challenged police scientific evidence, saying there had been multiple errors in the investigation. Knox and Sollecito were released after serving four years in prison.
A third person, Ivorian Rudy Guede, was found guilty and sentenced to 16 years in a separate trial. He is now the only person serving time for the murder, although prosecutors say he could not have killed Kercher by himself.
Last year, prosecutors filed a motion to appeal against the acquittals, calling the verdicts "contradictory and illogical".
Meredith Kercher was found dead and half-naked in a pool of blood in the apartment she shared with Amanda Knox.
The new trial will be held before a court in Florence.
Kercher, a student at Leeds University, was 21 when she died.
Knox returned to her Seattle-area home after she was released from prison in Italy and had been scheduled to speak publicly about the trial for the first time on American television in April, when her book about the case is due to be released.
Italian law cannot compel Knox to return from the U.S. for the new trial. The appellate court hearing the case could declare her in contempt of court but that carries no additional penalties.
It is unclear what would happen if she was convicted in a new appeals trial.
"If the court orders another trial, if she is convicted at that trial and if the conviction is upheld by the highest court, then Italy could seek her extradition," Knox's lawyer Carlo Dalla Vedova said Monday.
It would then be up to the United States to decide if it honors the request. U.S. and Italian authorities could also come to a deal that would keep Knox in the United States.
