In a statement, the former Haringey director of children’s services’ solicitors said they welcomed the decision.
The statement said: "We are pleased that the Supreme Court has refused the applications of the Secretary of State and Haringey Council for permission to appeal the decision of the Court of Appeal.
"We are considering with our client the implications of the decision of the Supreme Court."
This latest decision follows a landmark decision in May, when the Court of Appeal upheld a challenge by Shoesmith against a previous High Court ruling that her dismissal in the aftermath of the Baby P scandal was lawful.
The Court of Appeal found that Haringey Council and then children's secretary Ed Balls had been too hasty in seeking her dismissal and not given her a chance to put her case.
The Court of Appeal had also rejected a government request to appeal against this decision.
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