The Sicilian regional administrative court approved an appeal lodged by the central government in Rome for Sunday's decree to be scrapped, the AGI news agency reported.
Musumeci has clashed with officials in Rome over the issue, but anti-migrant opposition League party leader Matteo Salvini praised the move ahead of local elections next month.
The Sicilian leader had ordered that all migrants on the island's “hot spots” and reception centres be transferred to facilities outside the island.
Musumeci's decree also banned any migrant from “entering, transiting and stopping over on the Sicilian region's territory with vessels big and small, including those belonging to charities.”
A migrant detention centre in Sicily. Photo: AFP
But the court disagreed, saying “there was no rigorous investigation to demonstrate that the spread of Covid-19 was worsening among the local population because of the migration phenomenon.”
Sicily has no real means to transfer migrants outside the island, and interior ministry officials say migration is legally a central government prerogative.
The measures announced by Musumeci, who was elected on a right-wing ticket, “seemed to go beyond the scope of the powers conferred upon regions,” in
managing the coronavirus crisis, the court said.
Migration has for years been a hot-button political issue in Italy, a main EU landing point for people crossing the Mediterranean and arriving in Sicily and sister island Lampedusa.
People from Libya arrive on the Sicilian island of Lampedusa on July 31st, 2020. Photo: AFP
The court will now convene again on September 17 at Sicily's request which is planning to present new evidence to boost its case.
While dozens of migrants hosted in detention centres in Sicily have tested positive for Covid-19, health officials say the spread is due to conditions at the centres which are overcrowded with migrants who have been arriving daily by the hundreds in recent weeks.
From August 1st last year to July 31st this year, over 21,600 migrants arrived at Italy's shores – almost 150 percent more than the near 8,700 landings the year before, according to official data.
Despite the sharp rise, the number of migrant arrivals is still far below numbers recorded in recent years, especially before Rome signed a deal with Libya for its coast guard to prevent migrant departures.