The judges in Karlsruhe argued that a blanket ban on teachers wearing veils in school is not compatible with religious freedom, left-wing daily TAZ reports.
The newspaper saw a copy of the ruling on Thursday, although it is not due to be made public until later on Friday.
The ruling came in the case of two Muslim teachers who went to the court because they wanted to cover their heads for religious reasons. One wore a traditional veil, the other a type of hat.
But state officials said they were violating state law by wearing the headgear.
Teachers displaying “expressions of religiosity” which are seen to jeopardize the neutrality of the state and the peacefulness of schools, are banned in the westerly state's school system.
The Constitutional Court has now decided that this ban is “constitutionally limiting.”
In the future an abstract danger to state neutrality and peace at schools will not be sufficient. “An ample concrete danger” must exist.
TAZ reports that the ruling does no that mean that Islamic veils are now to be allowed under all circumstances.
If conservative parents were to organise protests against a teacher wearing such a veil, this could constitute a threat to school peace, which would be grounds for banning the veil.