US court overturns order releasing pro-Palestinian activist
Khalil, a legal permanent resident in the United States who is married to a US citizen and has a US-born son, was detained by immigration authorities for three months beginning in March.
He faced potential deportation for allegedly posing a threat to US foreign policy interests.
A former Columbia University student who was one of the most visible leaders of nationwide pro-Palestinian campus protests, Khalil was released from custody in June, but faced continued threats of deportation from federal authorities.
New Jersey federal judge Michael Farbiarz had ruled that Khalil's detention by immigration authorities was unlawful. But Thursday's ruling by the Philadelphia-based appeals court said Farbiarz did not have "subject-matter" jurisdiction in the case and that an immigration court should have adjudicated it.
"Today's ruling is deeply disappointing, but it does not break our resolve," Khalil said in a statement.
"The door may have been opened for potential re-detainment down the line, but it has not closed our commitment to Palestine and to justice and accountability."
The ruling, which could be appealed, does not take immediate effect, meaning Khalil will remain free for now.
The New York chapter of the American Civil Liberties Union said in a statement that "Mr Khalil's legal team has several legal avenues they may pursue."
In September, an immigration judge in Louisiana ordered Khalil be deported to Algeria or Syria after failing to disclose information on his application for US permanent residency. Khalil's lawyers vowed to appeal that ruling.