The US Supreme Court has ruled in favour of a Missouri church seeking state funding in a case that tests the boundaries of separation between church and state.

The case concerns Trinity Lutheran Church in Columbia, Missouri, which applied for a grant from the Department of Natural Resources to help renovate their preschool's playground. The state rejected the church's application, citing a strict policy against funding programmes controlled by a religious entity.

The Supreme Court ruled 7-2 against the state, writing that it may not deny the church a public benefit because of its religious status. In its policies against religious favouritism, the Court found, the state came dangerously close to preventing the free exercise of religion.

"This Court has repeatedly confirmed that denying a generally available benefit solely on account of religious identity imposes a penalty on the free exercise of religion," Chief Justice John Roberts wrote in the majority decision.

Justices Sonia Sotomayor and Ruth Bader Ginsberg dissented, arguing that the decision weakens the separation between church and state.

Justice Sotomayor claimed the ruling "dismantles a core protection for religious freedom" and ignores a history of separating state funding from religious causes.

"The Court today blinds itself to the outcome this history requires and leads us instead to a place where separation of church and state is a constitutional slogan, not a constitutional commitment," she wrote.

Supreme Court strikes down abortion restrictions Show all 23 1 /23 Supreme Court strikes down abortion restrictions Supreme Court strikes down abortion restrictions Abortion rights activists hold placards outside of the US Supreme Court ahead of an expected ruling on abortion clinic restrictions on June 27, 2016 in Washington, DC. Mandel Ngan/AFP/Getty Supreme Court strikes down abortion restrictions An abortion rights activist holds placards outside of the US Supreme Court before the Court struck down a Texas law placing restrictions on abortion clinics on June 27, 2016 in Washington, DC. The US Supreme Court on Monday struck down a Texas law placing a raft of restrictions on abortion clinics, handing a major victory to the "pro-choice" camp in the country's most important ruling on the divisive issue in a generation. Mandel Ngan/AFP/Getty Supreme Court strikes down abortion restrictions WASHINGTON, DC - JUNE 27: Pro-life activists pray on the steps of the United States Supreme Court on June 27, 2016 in Washington, DC. In a 5-3 decision, the U.S. Supreme Court struck down one of the nation's toughest restrictions on abortion, a Texas law that women's groups said would have forced more than three-quarters of the state's clinics to close. Pete Marovich/Getty Supreme Court strikes down abortion restrictions WASHINGTON, DC - JUNE 27: Texas abortion provider Amy Hagstrom-Miller looks on as Nancy Northup, President of The Center for Reproductive Rights speaks to the media outside of the U.S. Supreme Court on June 27, 2016 in Washington, DC. In a 5-3 decision, the U.S. Supreme Court struck down one of the nation's toughest restrictions on abortion, a Texas law that women's groups said would have forced more than three-quarters of the state's clinics to close. Pete Marovich/Getty Supreme Court strikes down abortion restrictions An abortion rights activist holds placards outside of the US Supreme Court before the Court struck down a Texas law placing restrictions on abortion clinics on June 27, 2016 in Washington, DC. The US Supreme Court on Monday struck down a Texas law placing a raft of restrictions on abortion clinics, handing a major victory to the "pro-choice" camp in the country's most important ruling on the divisive issue in a generation. Getty Supreme Court strikes down abortion restrictions Texas abortion provider Amy Hagstrom-Miller wipes a tear as she walks down the steps of the United States Supreme Court with Nancy Northup, President of The Center for Reproductive Rights on June 27, 2016 in Washington, DC. In a 5-3 decision, the U.S. Supreme Court struck down one of the nation's toughest restrictions on abortion, a Texas law that women's groups said would have forced more than three-quarters of the state's clinics to close. Pete Marovich/Getty Supreme Court strikes down abortion restrictions Abortion rights activists cheer after the US Supreme Court struck down a Texas law placing restrictions on abortion clinics, outside of the Supreme Court on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. Mandel Ngan/AFP/Getty Supreme Court strikes down abortion restrictions Abortion rights activists cheer after the US Supreme Court struck down a Texas law placing restrictions on abortion clinics, outside of the Supreme Court on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. Mandel Ngan/AFP/Getty Supreme Court strikes down abortion restrictions WASHINGTON, DC - JUNE 27: Abortion rights activists Morgan Hopkins of Boston, left, and Alison Turkos of New York City, celebrate on the steps of the United States Supreme Court on June 27, 2016 in Washington, DC. In a 5-3 decision, the U.S. Supreme Court struck down one of the nation's toughest restrictions on abortion, a Texas law that women's groups said would have forced more than three-quarters of the state's clinics to close. Pete Marovich/Getty Supreme Court strikes down abortion restrictions Abortion rights activists cheer after the US Supreme Court struck down a Texas law placing restrictions on abortion clinics, outside of the Supreme Court on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. Getty Supreme Court strikes down abortion restrictions WASHINGTON, DC - JUNE 27: Abortion rights activists Morgan Hopkins of Boston, left, and Alison Turkos of New York City, celebrate on the steps of the United States Supreme Court on June 27, 2016 in Washington, DC. In a 5-3 decision, the U.S. Supreme Court struck down one of the nation's toughest restrictions on abortion, a Texas law that women's groups said would have forced more than three-quarters of the state's clinics to close. (Photo by Pete Marovich/Getty Images) Getty Images Supreme Court strikes down abortion restrictions Abortion rights activist Morgan Hopkins of Boston, celebrates on the steps of the United States Supreme Court on June 27, 2016 in Washington, DC. In a 5-3 decision, the U.S. Supreme Court struck down one of the nation's toughest restrictions on abortion, a Texas law that women's groups said would have forced more than three-quarters of the state's clinics to close. Pete Marovich/Getty Supreme Court strikes down abortion restrictions Abortion rights activists embrace after the US Supreme Court struck down a Texas law placing restrictions on abortion clinics, outside of the Supreme Court on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. AFP/Getty Images Supreme Court strikes down abortion restrictions Abortion rights activists hold placards outside of the US Supreme Court ahead of a ruling on abortion clinic restrictions on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. Mandel Ngan/AFP/Getty Supreme Court strikes down abortion restrictions In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. Mandel Ngan/AFP/Getty Supreme Court strikes down abortion restrictions Abortion rights activists cheer after the US Supreme Court struck down a Texas law placing restrictions on abortion clinics, outside of the Supreme Court on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. AFP/Getty Images Supreme Court strikes down abortion restrictions Abortion rights activists cheer after the US Supreme Court struck down a Texas law placing restrictions on abortion clinics, outside of the Supreme Court on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. / AFP / MANDEL NGAN (Photo credit should read MANDEL NGAN/AFP/Getty Images) AFP/Getty Images Supreme Court strikes down abortion restrictions Abortion rights activists cheer after the US Supreme Court struck down a Texas law placing restrictions on abortion clinics, outside of the Supreme Court on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. / AFP / MANDEL NGAN (Photo credit should read MANDEL NGAN/AFP/Getty Images) AFP/Getty Images Supreme Court strikes down abortion restrictions Abortion rights activists embrace after the US Supreme Court struck down a Texas law placing restrictions on abortion clinics, outside of the Supreme Court on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. AFP/Getty Images Supreme Court strikes down abortion restrictions Pro-choice activist, Alissa Manzoeillo, of Washington, D.C. waits for rulings in front of the U.S. Supreme Court on June 27, 2016 in Washington, DC. A ruling is expected in Whole Woman's Health v. Hellerstedt, a Texas case the places restrictions on abortion clinics, as well as rulings in the former Virginia Governor's corruption case and a gun rights case. Pete Marovich/Getty Supreme Court strikes down abortion restrictions Abortion rights activists cheer after the US Supreme Court struck down a Texas law placing restrictions on abortion clinics, outside of the Supreme Court on June 27, 2016 in Washington, DC. In a case with far-reaching implications for millions of women across the United States, the court ruled 5-3 to strike down measures which activists say have forced more than half of Texas's abortion clinics to close. Supreme Court strikes down abortion restrictions Abortion rights activists hold placards outside of the US Supreme Court ahead of an expected ruling on abortion clinic restrictions on June 27, 2016 in Washington, DC. AFP/Getty Images Supreme Court strikes down abortion restrictions Abortion rights activists hold placards outside of the US Supreme Court ahead of an expected ruling on abortion clinic restrictions on June 27, 2016 in Washington, DC. AFP/Getty Images

The Trinity Lutheran Church first sued the state of Missouri in 2012, after the Department of Natural Resources removed them from competition for 14 Scrap Tire Programme grants. The church had ranked fifth out of 44 applicants.

A district court dismissed the church's suit, claiming the Free Exercise clause does not prevent states from withholding benefits – such as playground restoration grants – on account of religion. The Supreme Court overturned that ruling on Monday.

The decision could have cascading effects on the approximately 35 other states that also bar public money from funding religious institutions. These so-called "Blaine Amendments," which prevent money from the public treasury from going to any religious group or teacher, seek to prevent the state from showing favouritism to any one religion.