Nawaz Sharif's party Sharif rejected any possibility of reconciliation with the country's military ruler Friday.
President Gen. Pervez Musharraf, in political crisis since March when he made a failed attempt to fire the chief justice, has long vowed to prevent Sharif from coming back.
Local media welcomed the ruling, saying it shows an independent judiciary and will level a political playing field long dominated by the general.
Musharraf ousted Sharif in a 1999 coup but allowed him to leave for Saudi Arabia after he promised he would not return to Pakistan for 10 years.
But the Supreme Court, considering a petition filed by Sharif and his brother, ruled Thursday that they were free to return - turning up the heat on Musharraf to restore democracy and complicating his efforts to hold on to power.
On Friday, Sadique al-Farooq, a senior leader of Sharif's Pakistan Muslim League-N party, said "there is no chance for any reconciliation" with Musharraf.
"It is out of question," he told The Associated Press. "Democracy and dictatorship cannot go together."
Al-Farooq said their party would meet in the capital, Islamabad, on Saturday to consider dates for Sharif's return.
Musharraf, who made Pakistan a key ally of the United States in its campaign against terrorism after the Sept. 11, 2001 attacks, is under growing pressure to crack down on al-Qaida, the Taliban and local militants.
But his grip on power has loosened since March 9, when lawyers and opposition parties protested his bid to fire Chief Justice Iftikhar Mohammed Chaudhry, who was later reinstated by the court.
On Thursday, Chaudhry and six other judges said Sharif and his brother's return from Saudi Arabia should not be "hampered or obstructed" by the authorities.
The government accepted the ruling, though it suggested they could still face legal action on Pakistani soil and Musharraf's parliamentary affairs minister accused the judges of bias.
On Friday, the court began contempt of court proceedings against the minister, Sher Afgan Khan Niazi, who said the court had become a "party" to the political struggle.
The judges gave Niazi, who said he was expressing a personal view, two weeks to reply to the contempt charge. He faces up to six months imprisonment, if convicted.
Sharif and Benazir Bhutto, another ex-premier agitating for a comeback, insist Musharraf must let them contest year-end parliamentary elections if the votes are to be considered democratic.