WASHINGTON (Reuters) - The Obama administration can continue using federal tax dollars to fund human embryonic stem cell research, a U.S. appeals court ruled on Friday, overturning a lower court decision and handing a victory to the White House.

A federal judge ruled last year that the U.S. National Institutes of Health guidelines on such research violated the law because embryos were destroyed in the process and it put other researchers working with adult stem cells at a competitive disadvantage for federal grants.

That judge granted an injunction against such research funding, however it was put on hold pending appeal. The U.S. Court of Appeals for the District of Columbia Circuit on Friday vacated the injunction.

(Reporting by Jeremy Pelofsky, editing by Eric Beech)