The Museum of Old and New Art (MONA) in Hobart shut the lounge in April after NSW man Jason Lau complained to Tasmania's civil and administrative tribunal when he wasn't allowed entry.
The tribunal found Mr Lau had been discriminated against and ordered MONA to allow men access, something the gallery wasn't prepared to do.
Kirsha Kaechele said there were plans for a ladies' lounge celebration. (Ethan James/AAP PHOTOS)
MONA appealed in the Supreme Court of Tasmania, which on Friday quashed the tribunal's decision, ruling it had mischaracterised what the lounge intended to achieve.
The court ordered the tribunal to reconsider its decision.
MONA successfully argued the lounge addressed ongoing disadvantage faced by women.
"The patriarchy (has been) smashed and the verdict demonstrates a simple truth, women are better than men," artist and lounge curator Kirsha Kaechele said outside court.
"It's a day of triumph for us, and we're very excited".
MONA's lawyer Catherine Scott was confident the lounge would be granted an exemption by the tribunal upon its reconsideration and permitted to reopen.
Ms Kaechele, the wife of MONA founder David Walsh, said an announcement of some kind would be made soon.
"Something will happen with the ladies' lounge. There are plans in the works ... some kind of celebration," she said.
The tribunal erred by claiming the lounge only addressed past disadvantage experienced by women, Acting Justice Stephen Marshall said in his ruling.
"(The lounge's) intention was to promote equal opportunity by drawing attention to present and past societal disadvantage to women by providing them with the concept of a 'flipped universe'," he said.
The tribunal wrongly found disadvantage experienced by women was in the past, the judge said. (Ethan James/AAP PHOTOS)
"(It provides) women with a rare glimpse of what it is like to be advantaged rather than disadvantaged."
The tribunal also failed to properly consider a "report card" on the status of women in Australia which referenced current structural discrimination, Justice Marshall said.
During the court hearing, Mr Lau's lawyer Greg Barns argued the lounge's purpose was solely to reflect on historical disadvantage.
If the lounge was found to not be discriminatory it followed that you could cordon off areas "to make a point", he said.
The lounge was enclosed by a curtain and supervised by an attendant who only permitted entry to people who identified as female.
Ms Kaechele has previously flagged trying to find a loophole to reopen the space as a "church", "bathroom" or place of "education".
Justice Marshall noted the lounge was a participatory installation.
"The process of being admitted or refused admission and the participation in the ladies' lounge is part of the art itself," he said.
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