Mr Simpson was granted full custody of the children following his acquittal on criminal murder charges over the violent death of his wife, Nicole Brown Simpson. But while Mr Simpson was in jail, the Brown family acted as guardians for his children, a status they wanted to maintain after Mr Simpson's release.

OJ's murdered wife, Nicole - her parents want to use evidence of his violent behaviour

During the original custody hearing the judge refused to admit evidence that Mr Simpson may have killed his former wife along with her friend Ron Goldman, and granted full custody to him.

But the Browns appealed, and the court has concluded that the earlier decision was wrong, grossly unfair and that a new hearing should take place.

"It was manifestly unfair [to the Browns] to preclude them from introducing any evidence concerning the murder," the appeals court said, and it also criticised the judge for refusing to consider evidence of domestic violence by Simpson before the murders.

But Marjorie Fuller, the court-appointed lawyer for Sydney and Justin, said the children were "deeply disappointed" by the ruling and wanted to stay with their father.

"Both children are doing extremely well in his care. They are honour students and active in sports. They are doing as well as you would hope they would do," Ms Fuller said, adding that it could be months before a new custody hearing is held and then the hearing could last a considerable time.

For the moment the two children will remain with their father.