The appeal judges decided that fresh medical evidence showing Mrs Thornton was suffering from "battered woman syndrome" and had a personality disorder at the time that she plunged a knife into her husband should be put to a jury.
Mrs Thornton, who had served six years of a life sentence after losing a first appeal in 1991, has been granted bail pending a new trial to take place in Birmingham next year.
The judges had been asked to reduce her murder conviction to manslaughter on the grounds that she had been provoked by her husband's behaviour - and that her "vulnerable" personality made her more likely to snap in the face of his insults and threats.
Lord Taylor, the Lord Chief Justice said: "We are firmly of the view that the question of whether the appellant did lose or may have lost her self-control at the time of this killing is essentially a matter for a jury to decide. It is not for us."
Overruling her lawyers' claims that a new trial may be prejudiced by the huge amount of publicity her case has generated, Lord Taylor said he was confident a fresh jury "will be able fairly to try the case solely on the evidence they hear".
Mrs Thornton, 38, had plunged a kitchen knife into her husband Malcolm as he lay in drunken stupor at their home in Atherston Warwickshire, in June 1989, after she claimed he had called her a whore and threatened to kill her.
Her failed appeal, 17 months later, was the first in a series of high profile cases which placed domestic violence and law reform on the political agenda and questioned the defences available to women who kill violent partners - particularly provocation. It was argued that the need to prove a "sudden and temporary" loss of control did not take account of any period of time in which a defendant's emotions could simply "boil over".
But yesterday Lord Taylor underlined the law saying that even women suffering from battered women's syndrome still needed to prove a sudden loss of control. However, he added that since Mrs Thornton's first failed appeal, the law had been clarified to ensure that the jury had to consider a defendant's mental state when deciding whether or not they had lost control.
"We conclude that the fresh evidence and the clarification of the law cast doubt upon the basis of the jury's verdict in this case. We cannot therefore be sure that the verdict is safe and satisfactory," he said.
The judge said that Mrs Thornton's life had been punctuated by a series of "problems and unhappy incidents" caused by her personality disorder, including a number of suicide attempts, by slashing her wrists, cutting her throat and taking an overdose.
She left her first husband, taking their daughter Luisa, because of his drinking habits, and even before her marriage to Malcolm Thornton in August 1988 it was clear he had a serious drink problem.
It was a stormy marriage. There were angry scenes when he was drunk and he used violence, said Lord Taylor.
Mrs Thornton had denied threatening to kill her husband shortly before his death and had told police that she only intended to frighten her husband with the knife.
Lord Taylor said the single stab wound penetrated deeply through to the back of the ribcage. At her trial, she maintained the stabbing was an accident and her lawyers claimed that she had acted out of diminished responsibility.
After the hearing, Mrs Thornton left court without comment, on bail set at pounds 10,000, part of which was put up by Jennifer Nadel, home affairs editor for ITN who is making a documentary about the case for Channel 4. ITN put out a statement yesterday stressing that she was acting in a personal capacity.
One of Malcolm Thornton's son's, Stuart, said of the decision to hold a retrial: "The bottom line is our dad died six years ago and we are still going through it all today. It's not fair on us, it wouldn't be fair on any family."Reuse content