In the confession heavily relied upon by prosecutors, Dassey told police officers he helped Avery rape and kill Halbach at his Wisconsin salvage yard. Avery is now serving a life sentence for Halbach's murder. The judges ruled that Wisconsin courts had failed to consider Dassey's age - he was 16 at the time of the confession - and his diminished mental capacity when they rejected his earlier appeals.
A federal magistrate judge overturned Dassey's conviction previous year.
The 7th US Circuit Court of Appeals said that "no reasonable court" could find his confession was voluntary. Avery, who had previously been jailed for 18 years for a sexual assault in 1985, was exonerated in that case by DNA evidence in 2003.
The ruling stated that prosecutors' case against Dassey in the original trial rested nearly entirely on Dassey's interviews with police and one phone call with his mother - but no physical evidence.
In his dissent, Judge David Hamilton described the interview of Dassey as "gentle", and warned that the majority's ruling will pose new challenges for police officers. Millions of Americans were captivated when the murder, resultant investigations and subsequent trials were documented in the Netflix feature "Making a Murderer" past year. The two then burned her body, Dassey told detectives.
At the time of the killing of Teresa Halbach he was 16 years old, and had had no involvement with the criminal justice system. After several sessions, Dassey eventually confessed to being an accomplice to Halbach's rape and murder, and he was convicted for first-degree homicide, rape and mutilation of a corpse. The video also shows what appears to be detectives guiding Dassey to the answers they wanted.
Dassey's attorneys say they will take immediate steps to secure his release.
Johnny Koremenos, a spokesperson for Wisconsin Attorney General Brad Schimel, said the office will seek one of the latter two options, and hopes that the "erroneous decision will be reversed".
What Happened With Brendan Dassey's Interrogation? Because it's obvious the confession was involuntary, and because of the cases that were cited and the analysis that was done of the facts.
The ruling means Dassey could be released in the next 90 days. And now it will be up to a Sheboygan County Judge, who's been assigned to the case because the trial judge has retired, to decided whether the motion has any merit.