US Edition Officials at Torbay Council in Devon gave the controversial Monty Python's Flying Circus movie an X-rating when it was released in 1980.
The X-rated certificate effectively banned the film from all the cinemas in its villages and towns including Torquay, Paignton and Brixham.
The filmed prompted outrage from religious groups across the country who accused it of blasphemy and it was banned by 39 local authorities.
But Torbay Council has now lifted X rating 28 years later - after residents in the area voted it the 'funniest film of all time' in an on-line poll.
The film will now be shown at the English Riviera International Comedy Film Festival after the council sought legal advice to make the ruling void.
It will be screened at The Spanish Barn cinema - a former tithe barn which lies in the grounds of Torre Abbey, a converted monastery in Torquay.
A spokesman for the council said: "The decision relating to the previous screening of the film is now void."
On its initial release in the UK the film was banned by several councils - some of which had no cinemas - for its irreverent representation of Christ.
A total of 28 authorities enforced a local X-rating and 11 banned it outright and many cinemas where it was shown were picketed.
It was also banned in the Republic of Ireland and in Norway prompting promoters in Sweden to dub it "the film so funny that it was banned in Norway".
The 1979 film, starring John Cleese, Michael Palin, Terry Jones, Graham Chapman and Eric Idle, tells the story of Brian Cohen - played by Chapman.
He is a a young Jewish man born in the same era and location as Jesus Christ who is mistaken for the Messiah
The famous line 'He's not the Messiah, he's a very naught boy' was recently voted the funniest line from a film off all time.