The Swiss Federal Tribunal has upheld Sun Yang's appeal against an eight-year doping ban that was handed down at the start of the year.
In February, Yang has found guilty by the Court of Arbitration for Sport (CAS) in a bombshell verdict and was handed the maximum eight-year ban.
The World Anti-Doping Agency (WADA) made a statement today saying it had been informed of the decision to overturn the swimmer's ban.
"The Swiss Federal Tribunal's decision upholds a challenge against the Chair of the CAS Panel and makes no comment on the substance of this case.
"In the CAS award, WADA clearly prevailed on the substance of the case as it was able to show that there were a number of aspects of the original FINA decision that were incorrect under the World Anti-Doping Code and the related International Standard for Testing and Investigations.
"WADA will take steps to present its case robustly again when the matter returns to the CAS Panel, which will be chaired by a different president."
A vial of the 28-year-old's own blood sample was smashed with a hammer during a testing session, but Sun was acquitted by swimming's ruling body FINA of anti-doping violations, agreeing that testers had failed to produce adequate identification during their visit.
The ruling outraged WADA which took the matter to CAS, demanding a ban of between two and eight years for missing the out-of-competition test.
The Swiss-based CAS upheld the appeal by WADA against FINA and Sun, one of China's most recognisable athletes who had already served a doping ban in 2014.
The eight year ban effectively ended the triple Olympic gold medallist's professional career in the pool.
Today's decision does not state how much the ban will be reduced.
SUN YANG'S PAST
Sun, a three-time Olympic freestyle champion, has become one of the most infamous athletes in the world in the eyes of Australians after twice drawing the ire of doping officials and clashing with local favourite Mack Horton.
Sun, who won the 400m and 1500m freestyle in London and the 200m in Rio, first served a doping suspension in 2014 after testing positive to a drug he said he was using to treat heart palpitations and was unaware had recently been added to the banned list.
Australian swimmer Mack Horton spoke out against Sun at the Rio Olympics and his protest appeared to be validated when his rival was accused of refusing to provide blood and urine samples when drug testers visited his home in China in September in 2018.
After being cleared by FINA, Sun was able to compete in the World Championships in Gwangju, South Korea, in July, where he won two golds but became a focus of protests from rivals, including Horton who infamously refused to step on the podium after finishing second to Sun in the 400m freestyle.
Sun's CAS hearing, the first in 20 years that was open to the public, was beset by technical difficulties and interpreting errors between Chinese and English which frustrated lawyers and held up proceedings.
Before Ferbuary's verdict was delivered, Australian swimming coach Jacco Verhaeren attempted to downplay the importance of the result on Horton's chances in Tokyo.
"Mack is a very focused athlete, he's not easily distracted and he won't be distracted by this either," Verhaeren said on Friday.
"He has dealt with situations like this before and never gets distracted so he won't be in this case.
"He made his stance. His stance won't change and that is fine. But we're not in the business of commenting on foreign athletes or whatever the outcome is."
Australia's Olympic 100m freestyle champion Kyle Chalmers remains in Horton's corner. "I am in full support of my teammate Mack … I support Mack and what Mack stands for," Chalmers said earlier on Friday.