Adoption agency Catholic Care must no longer turn away gay couples if it is to maintain its charity status, according to an upper tribunal ruling.
The charity, which is formally part of the diocese of Leeds, appealed to be exempt from having to provide adoption services for gay couples under the Equality Act 2010 but this was rejected by the judge.
The ruling stated that the charity was "risking the loss of suitable same sex couples to the adoption system as a whole by subjecting them to the 'particularly demeaning' experience of discrimination on the grounds of their sexual orientation."
"The tribunal's conclusions on this point also mean that it must reject the charity's argument that it could potentially increase the number of adoptions by increasing the number of potential adopters who approached the charity but would not approach other agencies."
Secularist campaign group the British Humanist Association (BHA) welcomed the ruling.
'This ruling sends a clear signal that religious organisations, including religious charities, providing public services may not simply opt themselves out of a law which prevents discrimination on grounds of sexual orientation," said the BHA's head of public affairs Pavan Dhaliwal
"When groups are providing public services, not least vital services such as adoption, it is legitimate to prevent unjustified discrimination, as the law seeks to do, in order to ensure that those services are equal, accessible and operate for the interests of those they are helping."
Under the 2007 Equality Act, all adoption providers were prevented from discriminating against potential foster parents according to their sexual orientation.
Monica Carss-Frisk QC, who represented Catholic Care, said the decision was "tantamount to putting the interests of the helper before those of the helpless".
The ruling brings to an end a five year legal battle by the group.