The decision on Friday overturns a lower court's rejection of the extradition request.
Diplomatic and trade relations between the two countries now ride on the fate of the extradition bill.
The case has fuelled the row over the fairness of the extradition treaty between the UK and the US.
Justice Helen Winklemann said that the defence team needed access to the evidence ahead of the extradition hearing, due in March.
The key issues included: The fairness of the Extradition Act 2003 (covering the US) and the European Arrest Warrant.
"We have never had and do not have any intention of asking for the extradition of Mr Megrahi.
Function of the enhancer.
In the past year, Egypt has secured the extradition of dozens of suspects from as far afield as Ecuador and South Africa.
Since the group's alleged victims are all in China, Beijing has formally requested the extradition of many of the suspects.
The rebel leader will not be extradited, since Italian law forbids the extradition of political refugees.
