A federal appeals court on Friday overturned the District of Columbia's longstanding handgun ban, issuing a decision that will allow the city's citizens to have working firearms in their homes.

In the ruling, the U.S. Court of Appeals for the District of Columbia rejected city officials' arguments that the Second Amendment right to bear arms only applied to state militias.

District of Columbia Mayor Adrian Fenty told reporters Friday afternoon that the District will appeal the ruling.

In a 2-1 decision, the judges held that the activities protected by the Second Amendment "are not limited to militia service, nor is an individual's enjoyment of the right contingent upon his or her continued intermittent enrollment in the militia."

"This is a huge case," Alan Gura, the plaintiffs' lead lawyer, told FOXNews.com Friday afternoon. "It's simply about whether law-abiding citizens can maintain a functioning firearm, including a handgun, inside their house."

Gura said his six clients, all Washington residents, challenged three separate District of Columbia laws: A 31-year-old law that prevents handgun registration; a law that requires rifles and shotguns to be either disassembled or disabled when being stored; and a law that requires a permit to carry a gun in your own home.

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Gura said the law does not affect law that governs concealed carry permits outside the home.

"I don't see this going into effect immediately, but certainly, you know, when it does go into effect, our clients, as well as everyone in Washington, will be able to have a handgun and maintain their home without having a permit to move it around in their home," Gura said.

The case began five years ago. In 2004, a lower court judge lower-court judge said the plaintiffs did not have a constitutional right to own handguns. The plaintiffs include residents of high-crime neighborhoods who wanted the guns for protection.

"The district's definition of the militia is just too narrow," Judge Laurence Silberman wrote for the majority on Friday. "There are too many instances of 'bear arms' indicating private use to conclude that the drafters intended only a military sense."

Judge Karen Henderson dissented, writing that the Second Amendment does not apply to the district because it is not a state.

The Bush administration has endorsed individual gun-ownership rights, but the Supreme Court has never settled the issue.

If the dispute makes it to the high court, it would be the first case in nearly 70 years to address the Second Amendment's scope.

Fenty said the city government will exercise petition for a rehearing, which will be an "en banc" review to take place before all the court's judges instead of the three-judge panel that considered the case. Depending on the court's decision, the case can be appealed to the Supreme Court.

"We intend to do everything in our power to work to get this decision overturned, and in the meantime, we will vigorously enforce our handgun law," Fenty said.

He said the decision "flies in the face of laws that have helped decrease gun violence," noting that it was the first time a federal appeals court has struck down a gun law on the basis of the Second Amendment.

The Second Amendment of the U.S. Constitution, in its entirety, states: "A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear arms, shall not be infringed."

Gura predicted that the case, because of clear arguments, can now be used in other federal cases to support Second Amendment arguments that citizens have the "right to keep and bear arms."

"This case will have significant impact beyond the District of Columbia," Gura said. He did not know if any other cases would be affected immediately by the decision.

Silberman wrote that the Second Amendment is still "subject to the same sort of reasonable restrictions that have been recognized as limiting, for instance, the First Amendment."

Such restrictions might include gun registration to provide the government with information about how many people would be armed if militia service was required, firearms testing to promote public safety or restrictions on gun ownership for criminals or those deemed mentally ill.

The decision is spurring action on Capitol Hill as well. Working with the National Rifle Association, Sen. Kay Bailey Hutchison, R-Texas, said she would reintroduce a piece of legislation aimed at keeping handguns legal in the District. The measure has previously passed in the House, but failed in the Senate.

"Not only is Washington, D.C.'s gun ban unconstitutional, but it also has been a public policy failure as seen in the rise in crime since its enactment. The time has finally come to change course," Hutchison said, according to a news release.

FOXNews' Greg Simmons and Mike Majchrowitz and The Associated Press contributed to this report.