In a verdict upholding a High Court decision, the UK’s most senior court this morning dismissed the Government’s appeal against last November’s verdict.
By a majority of eight to three, the Supreme Court judges ruled the Government must gain an Act of Parliament before triggering Article 50.
But the Supreme Court boosted the Government by ruling devolved parliaments in Scotland, Wales and Northern Ireland do not need to vote on Article 50 before Brexit can begin.
The verdict represents a major blow to Scottish First Minister Nicola Sturgeon's fight against her country being taken out of the EU.
The pound dipped in value on currency markets following this morning's verdict but later staged a fightback.
Attorney-General Jeremy Wright, who presented the Government's case during the Supreme Court hearing last month, said: "Of course the Government is disappointed with the outcome.
"The Government will comply with the judgement and do all that is necessary."
Mr Wright added the Supreme Court had been clear "it has not been deciding whether the UK should or should not leave the EU".
He said: "The people of the UK have already made that decision", adding Brexit is now a "political mater and not a legal matter".
Theresa May must get the consent of MPs before triggering Article 50
The Liberal Democrats and SNP have already stated their MPs will try to defeat an Article 50 bill
Today's ruling means the Prime Minister now has 67 days to secure the consent of Parliament before invoking Article 50 and beginning EU divorce talks.
Mrs May has repeatedly vowed to trigger Article 50 by the end of March and had hoped to avoid a parliamentary showdown over Brexit by insisting ‘royal prerogative’ powers gave her the right to trigger Article 50 alone.
The Supreme Court today agreed with the High Court the Prime Minister does not have that power.
The Government is already believed to have drafted a short parliamentary bill aimed at authorising Brexit negotiations, which MPs could now vote on as early as next week.
Brexit Secretary David Davis will address the House of Commons later today.
Tory MP and leading Brexit campaigner Dominic Raab, a member of the Change Britain group, said: "The Government was right to appeal, and the Supreme Court has usefully made clear that a short Bill authorising the start of negotiations is all that is needed.
"Let's have an end to the wrecking tactics.
"Every democrat in Parliament should now support this legislation, so we can get on and deliver on the will of the British people, and secure the best possible deal for the whole country."
Ukip leader Paul Nuttall said: "This decision is hardly a surprise but in the end it will make no real difference. The will of the people will be heard, and woe betide those politicians or parties that attempt to block, delay, or in any other way subvert that will.
"Other than making clear that this is a decision of the whole United Kingdom, rather than its constituent parts, what we can clearly see is that it will embolden those who rail against the decision of the people.
"It may give heart to those in the EU, used as they are to ignoring their own people, to attempt to play hard ball in the negotiations.
"But in the end I am convinced that though this skirmish has been lost in the courts, the war will be won".
Lead claimant Gina Miller hailed today's ruling
Gina Miller, an investment manager and the lead claimant in the Article 50 challenge, said: "Today eight of the eleven Supreme Court judges upheld the judgement handed down by the Hight Court in November in a case that went to the very heart of our constitution and how we are governed.
"Only Parliament can grant rights to the British people and only Parliament can take them away.
"No Prime Minister, no Government can expect to be unanswerable or unchallenged. Parliament alone is sovereign.
"This ruling today means that MPs we have elected will rightfully have the opportunity to bring their invaluable experience and expertise to bear in helping the Government to select the best course in the forthcoming Brexit negotiations.
"Negotiations that will frame our place in the world and all our destinies to come.
"There is no doubt that Brexit is the most divisive issue of a generation but this case was about the legal process not politics.
"Today's decision has created legal certainty based on our democratic process and provides the legal foundations for the Government to trigger Article 50."
Describing a "most arduous process" that has seen Ms Miller suffer death threats in the wake of November's High Court ruling, the businesswoman thanked her lawyers for their support "in the face of extraordinary and unwarranted criticism".
She added: "In Britain we are lucky, we are fortunate to have the ability to voice legitimate concerns and views as part of a shared society.
"I have therefore been shocked by the levels of personal abuse that I have received from many quarters over the last seven months for simply bringing and asking a legitimate question.
"I sincerely hope that going forwards people who stand in positions of power and profile are much quicker in condemning those who cross the lines of common decency and mutual respect."
Lord Neuberger reads out the Supreme Court decision
Attorney-General Jeremy Wright admitted the Government were 'disappointed' by the ruling
Fears MPs could try and derail Brexit through a vote on Article 50 have been eased after Labour leader Jeremy Corbyn insisted his party would not block Britain’s EU departure.
But it has been reported up to 80 Labour MPs, including some shadow cabinet members, could defy their party leader and vote against Article 50.
The Liberal Democrats and SNP have already stated their MPs will try to defeat an Article 50 bill if their demands are not met.
Liberal Democrat leader Tim Farron said: "I welcome today's judgement. But this court case was never about legal arguments, it was about giving the people a voice, a say, in what happens next.
"This Tory Brexit government are keen to laud the democratic process when it suits them, but will not give the people a voice over the final deal. They seem happy to start with democracy and end in a stitch up.
"The Liberal Democrats are clear, we demand a vote of the people on the final deal and without that we will not vote for Article 50."
Opposition parties are also likely to try and add amendments to the bill in an attempt to meddle with Brexit negotiations.
House of Commons clerks have told Labour they will not be able to add amendments relating to specific aspects of Article 50 talks, such as forcing the Government to ensure continued access to the Single Market as part of any Brexit deal.
But they could demand the Prime Minister officially publishes her Brexit negotiating aims and force a parliamentary vote on any exit deal early enough so the Government could be sent back to Brussels to negotiate a new one.
Responding to this morning’s Supreme Court judgment, Mr Corbyn said: “The Government has today been forced by the Supreme Court to accept the sovereignty of Parliament.
“Labour respects the result of the referendum and the will of the British people and will not frustrate the process for invoking Article 50.
“However, Labour will seek to amend the Article 50 Bill to prevent the Conservatives using Brexit to turn Britain into a bargain basement tax haven off the coast of Europe.
“Labour is demanding a plan from the Government to ensure it is accountable to Parliament throughout the negotiations and a meaningful vote to ensure the final deal is given Parliamentary approval."
Meet the Supreme Court Judges who will get last say on Article 50
Thu, December 1, 2016
These are the Supreme Court Judges who could stop Theresa May triggering Article 50 next week, throwing the UK’s plans to break from the EU into total disarray.
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The Supreme Court Judges.
Meanwhile, despite previous threats from peers they could delay or even block the approval of Article 50, the House of Lords is also expected to authorise the start of Brexit talks.
The Government has already put peers on notice it could revive efforts to curb the powers of the House of Lords if it hampers Brexit.
Tory MPs have also suggested swamping the House of Lords with hundreds of Brexit-backing peers should it vote against Article 50, while there have also been calls to scrap the upper chamber completely if it defies the EU referendum result.