The Italian appealed against the Football League's decision not to grant him ownership of the West Yorkshire club last week.
A spokesman for the Football League has said that they are "disappointed" that the decision has been overturned.
A statement by the Football League said: "We are disappointed at the outcome of the appeal hearing, however we would like to thank the independent QC for his diligence in reviewing this decision.
"This was never about individual personalities, but instead was a matter in which we were obliged to uphold the integrity of our regulations having considered the issue in detail with our advisors.
"It was always an extremely complex matter in which a different interpretation of a judgement made under Italian law could lead to an entirely different outcome in the context of our regulations. Ultimately this has proven to be the case.
"The independent QC has concluded that Mr. Cellino's recent conviction in the Sardinian Court did not involve conduct that would 'reasonably be considered to be dishonest' based on information available to him at the current time. The Football League will now consider the findings of the hearing."
Leeds lost 1-0 to Wigan Athletic in the Championship earlier this afternoon.