Liverpool councillors have won a joint court action along with counterparts in Sheffield that ruled cuts in European funding were unlawful.
The case was heard by a High Court judge in Leeds last week, where the funding decision was overturned and forced the government to reconsider.
Evidence showed that Liverpool City Council received 140m Euros (£124.7m) less from ministers than they had estimated their share to be.
The government allocated Merseyside 202m Euros (£167.836m) of EU funding for 2014-2020, when the European Commission calculated it to be 350m Euros (£290.147m). The balance was allocated to other areas.
Liverpool Mayor Joe Anderson told BBC News: “It is excellent news. The government had complete disregard for its legal duty when making the decision and it was well-documented that Liverpool is one of the most deprived areas in the country.”
Mayor Anderson had previously described it as: “Robin Hood in reverse – taking from the poor to give to the rich.”
The funding award to Liverpool City Region works out at 147 Euros per head of population (£122.14), compared to 380 Euros per person (£315.65) in the previous funding from 2007-13.
Business minister, Michael Fallon, said: “I am pleased the High Court accepted all our main arguments – we have always said the structural funds allocations were sound.
“We are looking into whether our Equality Impact Assessment requires further work, and we hope to submit the final allocations to the European Commission in the next few weeks. Structural funds boost jobs, growth and skills, and the sooner we can get this money to all parts of the UK the better.”
The decision on allocations within in the UK is decided by the UK government, despite the fact that the money comes from the European Union.