The supreme court in Egypt has overturned an earlier ruling by a lower court that banned gas sales to Israel, BBC reported.
The new ruling requires that the government should make clear the quantity of gas it exports to Israel and how much it charges.
Lawyers had argued that the gas was being sold at preferential rates.
Egypt's gas trade with Israel is controversial, as many Egyptians are opposed to links between the two countries - despite a 1979 peace deal.
Some opposition figures in Egypt are against the sale of gas to Israel because they disagree with its policies towards the Palestinians.
This ruling ends a legal battle which stirred up public controversy.
Over a year ago, lawyers had successfully argued for a ban on natural gas exports to Israel, claiming the price was below the international market level.
The supreme administrative court has said that the lower court which made that ruling has no jurisdiction in cases of this kind because they involved state sovereignty.
Pipeline flow
It did add, however, that Egypt should take steps to monitor the price and quantity of its exports ensuring domestic needs are met before selling gas abroad.
Gas started flowing to Israel from Egypt through a pipeline in 2008, under an agreement contracted to last for 20 years.
In reality, supplies were never cut off when there was a court ruling banning sales.
It was ignored by the government, pending a review.
The final legal decision is unlikely to enjoy wide support in Egypt.
Although the country has had a peace treaty with Israel since 1979, Israeli policies in the Palestinians territories make it unpopular with many Egyptians.
During the conflict in Gaza, there were increased calls to stop gas exports.