The ruling was upheld by the High Court at Auckland.
Crown lawyer John Pike, acting for the US Government, argued in Wellington's Court of Appeal last September that the District Court had no power to make disclosure decisions in an extradition case.
Disclosure was extensive and could involve billions of emails, the court was told.
Dotcom's legal team said that without knowledge of the FBI's evidence, they could not adequately prepare for the extradition case.
In a 49-page judgement released in March, the Court of Appeal accepted while an extradition judge could refuse to extradite on insufficient evidence, the hearing was not the same as a full trial.
Countries making extradition requests, like the US in this case, are bound to present its case with a "duty of candour and good faith".
But it is up to them to decide what information it wishes to put forward in support of its request.
"The suspect is entitled to challenge the reliability of the record, whether by argument or leading evidence," the judgement said.
If a court decides it needs more detailed information, however, it can ask the Ministry of Justice to seek it from the country wanting the person extradited.
For extradition to be granted, the court must conclude that there is a case for the suspect to answer.
"It follows from the foregoing analysis that, in our view, the disclosure orders in this case were wrongly made," ruled the Court of Appeal.
"We allow the appeal and quash the disclosure orders made by the District Court."
