Chile's top court has suspended the development of El Morro mine after siding with indigenous groups opposing it.
The Supreme Court on Tuesday ordered the project's environmental permit to be halted until the Diaguita indigenous community is consulted.
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It overturned a lower court decision to dismiss an appeal filed last April by the Diaguita, who demanded to be consulted about the mine owned by Canada's Goldcorp.
Several mining projects in mineral-rich Chile have been put on hold after opposition by local communities.
Last year, Chile's environmental regulator blocked work at Barrick Gold Corp's $8.5 billion Pascua-Lama.
The project straddling the Argentina-Chile border has faced rising costs, falling gold prices and environmental lawsuits by Diaguita communities in the foothills of the Andes downstream from the mine.