The ruling marks a victory for President Donald Trump, who has sought to shore up funds for his signature border wall. The money is separate from other funds that the Supreme Court allowed to be used last year.
In a 2-1 ruling, the 5th Circuit Court of Appeals granted a stay of a Texas judge's order, which the administration had appealed. The case is still ongoing.
The use of Defense Department funds for the President's border wall has received pushback from numerous groups and states, which have argued the administration circumvented Congress to shore up wall funds.
The latest ruling applies to the military construction funds. Last September, Secretary of Defense Mark Esper authorized diverting $3.6 billion in the construction funds for 11 wall projects on the southern border with Mexico. The Pentagon said at the time that half the money was coming from deferred projects overseas, and the other half was planned for projects in the US.
The ruling doesn't apply to the use of other funds, including counter-drug and Treasury Forfeiture Funds, that have been designated for wall construction.
In February 2019 Trump ended a 35-day government shutdown when Congress gave him $1.4 billion in wall funding, far less than he had sought. He subsequently declared a national emergency to get money from other government accounts to construct sections of the wall.
"We don't control our own border," Trump claimed at the time. "We're going to confront the national security crisis on our southern border and we're going to do it -- one way or the other we have to do it."
Trump has repeatedly made claims about "tremendous amounts of drugs" crossing into the US from the southern border -- even though the majority of those drugs come through ports of entry -- and addressed the issue of human trafficking.
The lawsuit, brought by El Paso County, Texas, and Border Network for Human Rights, argued that Trump overstepped his authority when he issued a national emergency declaration to gain access to additional funds for his border wall, despite receiving the $1.375 billion from Congress.
Kristy Parker, counsel at the nonpartisan nonprofit Protect Democracy, emphasized in a news release Wednesday that "a court has already determined that the government can't lawfully use military construction funds to build Trump's border wall."
"It's unfortunate that the people of El Paso will continue to suffer harm while the government appeals, but we're confident that we'll prevail again in this next stage of litigation," she said.
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