The Isle of Wight Council tried to fine Jon Platt Â£120 for taking his daughter on a once-in-a-lifetime family holiday to Florida during term time.
But magistrates backed the father, so the council appealed to the High Court, which again ruled in Mr Platt's favour.
The Supreme Court has said it will allow a final challenge by the council.
On Wednesday, a panel of three justices who reviewed the case decided a hearing should go ahead.
It is expected to take place on January 31.
Isle of Wight Council, as the local education authority, took the case to London's High Court but senior judges backed the magistrates' ruling in favour of the father.
He had argued he should not be fined over the absence because his daughter's attendance was considered good.
The council submitted papers to the Supreme Court for permission to launch a final legal challenge.
It made the application at the request of Schools Minister Nick Gibb.
The council argued the case raised important issues for schools and families up and down the country.
The Department for Education said it would work with the Isle of Wight to consider the next steps.
"Our position remains that children should not be taken out of school without good reason.
"That is why we have tightened the rules and are supporting schools and local authorities to use their powers to tackle unauthorised absence.
"The evidence shows that every extra day of school missed can affect a pupil's chances of achieving good GCSEs, which has a lasting effect on their life chances - vindicating our strong stance on attendance."
But parents face much higher flight and accommodation prices during the school holidays, and some choose to miss a few days to take advantage of this.
Mr Platt said in response: "I am disappointed that the appeal has been allowed.
"Their position is so shocking I hoped the court would say it was not arguable, let alone winnable.
"The decision creates uncertainty and distress for parents, who will be worried sick for the next few weeks that they may have committed a criminal offence by taking their children out of school.
"But I am delighted we won't have to wait long for the hearing.  Usually it would take six months for a full hearing, so it has been expedited."
A long-running legal battle over whether parents are allowed to take children on holiday during term time is to be decided in the Supreme Court.