The US Patent Office has ruled that the Washington Redskins nickname is "disparaging of Native Americans" and that the team's federal trademarks for the name must be cancelled.
The 2-1 ruling comes after a campaign to change the name has gained momentum over the past year. The team does not immediately lose trademark protection and is allowed to retain it during an appeal.
Redskins owner Daniel Snyder has refused to change the team's name, citing tradition, but there has been growing pressure including statements in recent months from President Barack Obama, lawmakers of both parties and civil rights groups.
The decision means that the team can continue to use the Redskins name, but it would lose a significant portion of its ability to protect its financial interests. If others printed the name on sweatshirts, apparel, or other team material, it becomes more difficult to go after people who use it without permission.
The decision by the Trademark Trial and Appeal Board is similar to one it issued in 1999. That ruling was overturned in 2003 in large part on a technicality after the courts decided that the plaintiffs were too old and should have filed their complaint soon after the Redskins registered their nickname in 1967.
The new case was launched in 2006 by a younger group of Native Americans, and was heard by the board in March of last year.
The group argued that the Redskins should lose their federal trademark protection based on a law that prohibits registered names that are disparaging, scandalous, contemptuous or disreputable.