Librarian of Congress James H. Billington added the practice, described in the ruling as "jailbreaking," to a list of actions that don't violate copyright protections. The decision affecting iPhones and other smart phones was posted Monday on the agency's website.
The library acted as part of a periodic review by its copyright office, called for under a 1998 law, into whether legal uses of technology were being blocked. The ruling was a victory for Apple critics led by the Electronic Frontier Foundation, a San Francisco-based privacy-rights group that petitioned the library.
"Now people can go ahead and fix their phones and jailbreak them so they can run all sorts of different applications," Corynne McSherry, the group's senior staff attorney, said in an interview. "They can make full use of the phone they bought without some kind of legal liability hanging over their head."
Apple has sold almost 60 million iPhones since its 2007 debut. The company's App Store has more than 225,000 applications available for download. The process for inclusion in the App Store has drawn criticism from some developers whose material was rejected by the company.
Apple, based in Cupertino, Calif., says it typically withholds approval of applications because they have technical bugs or contain material such as pornography that the company considers inappropriate.
"Apple's goal has always been to ensure that our customers have a great experience with their iPhone and we know that jailbreaking can severely degrade the experience," Natalie Harrison, an Apple spokeswoman, said Monday.
The Library of Congress also ruled that people don't violate the law when they circumvent copy protection on DVDs and extract short excerpts to create new, noncommercial works.