The ruling was a setback for Mr Hunt because the case involved the first legal testing of a new government procedure for dealing with failing NHS organisations - referred to as the Unsustainable Providers Regime.
Under the new regime, Mr Hunt had appointed a Trust Special Administrator (TSA) to the "very badly performing" South London Healthcare Trust.
To help deal with the problem, the special administrator recommended measures including cuts at Lewisham Hospital.
Mr Hunt told Parliament in January that A&E and maternity services at the hospital would be downgraded.
He assured MPs the changes would improve patient care in south London, saving up to 100 lives a year, but gave an undertaking not to implement them pending the legal challenge.
The challenge against the government was brought by Save Lewisham Hospital and the London Borough of Lewisham.
Tony O'Sullivan, from the Save Lewisham Hospital Campaign, said: "We are disappointed by the Secretary of State's decision to launch an appeal.
"However, we are confident that the strength of our case will be upheld at appeal."
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