Nearly 40 illegal sixth forms in Kent have been given Government permission to carry on in the face of outright hostility from the Further Education Funding Council.
Gillian Shephard, the Education and Employment Secretary, has approved sixth forms in 21 secondaries and one church school, and accepted proposals for them from 15 grant-maintained headteachers.
Most have been running unofficial sixth forms for up to 30 years, and some have fewer than 100 pupils.
The FEFC told the Government that only six of the sixth forms were justified after an inquiry into the need for greater student choice.
Mrs Shephard's decision to overrule its findings will spark fresh fears among colleges that they will lose out to schools in the scramble for 16-year-olds.
Many already feel threatened by proposals in the education White Paper to allow opted-out schools to open sixth forms without consulting the Secretary of State. Patricia Stubbs, spokeswoman for the FEFC, said Mrs Shephard's decision was "disappointing".
And it is now clear that deregulation of the sector is likely to further sideline the FEFC, which advises the Secretary of State on whether moves to set up a school sixth form would add to choice.
The six schools whose proposals were rejected - four LEA secondaries, one church school and one GM school - were authorised earlier this year to enrol students for sixth forms and courses will still go ahead. Mrs Shephard has told them they will not have to close their sixth forms immediately. Courses will start in September and changes will be phased in gradually.
Nearly all of Kent's 120 secondary schools admit sixth-formers and the unofficial sixth forms were mostly set up in non-selective high schools for students to resit exams.
Funding for the unapproved sixth forms has been provided by Kent county council through its local management of schools scheme. Several were launched under the previous Tory administration.
The local authority, Funding Agency for Schools and the FEFC were asked by ministers to help sort out the chaotic post-16 system in Kent. It is understood that only the FEFC and one school in the county objected to the sixth forms continuing.
Roy Pryke, director of education services, said approval for the sixth forms was "good news for all the hundreds of young people anxious to stay on at secondary schools." He added: "The schools can now go on from strength to strength."