The 39-year-old has been entangled in a period of conflict with world football's governing body since his contract with Lokomotiv Moscow was terminated by the Russian club in 2014.
Leaving the side because of a falling-out with the manager at the time, Diarra was ordered to pay £8.4m due to a breach of contract, whilst also being suspended from professional football for 15 months.
Looking to continue his career, the former France international agreed a move to Belgian outfit Charleroi, before FIFA refused to issue the club with an International Transfer Certificate (ITC).
An ITC is needed by clubs around the world to register new signings, and without one for Diarra, a deal for the midfielder collapsed in the final stages.
FIFA transfer rules break European Union laws
After a long-running case, the European Court of Justice have found in favour of Diarra, with some of FIFA's transfer rules breaking European Union laws.
In a statement from the court, it is claimed that the rules "impede the free movement of professional footballers wishing to develop their activity by going to work for a new club."
The specific issue that the court have focused in on involves the failure of FIFA to provide Diarra with an ITC for his proposed move to Charleroi.
A FIFA spokesman said: "FIFA is satisfied that the legality of key principles of the transfer system have been reconfirmed in today's ruling.
"The ruling only puts in question two paragraphs of two articles of the FIFA regulations on the status and transfer of players, which the national court is now invited to consider."
What does this ruling mean for football transfers?
Following this landmark ruling, FIFA will likely need to revise some of its transfer rules in order to remain in line with European Union regulations.
There is set to be a shift whereby footballers are viewed more as working professionals instead of merely business assets owned by clubs.
As a result, players could be in line for more power when deciding their next clubs after disputes over contracts, with FIFA's rules becoming less restrictive.
The global players' union Fifpro have claimed that the ruling "will change the landscape of football", whilst Diarra's lawyers have called the decision by the European Court of Justice a "total victory".
However, Friday's ruling will not bring about an overnight change to the way the transfer system works, as the case must now go back to the Belgian courts, where it will be officially ruled upon.
Should those courts back the CJEU's ruling then it could open the door for players to be able to terminate their contracts more easily, as they would not be denied the opportunity to sign for a new club afterwards.
Any club looking to snap up free agents who have had their deals terminated by their previous club due to a breach of contract would also no longer be liable to pay compensation for that player, making them a cheaper and more appealing option.
In theory, this could open the door for players to exploit a loophole in the system by purposefully breaching their contracts - for example by refusing to turn up to training - in the hope that their deal will be terminated by their current club.
Should that be the case, they could then be free to join another club as a free agent outside of the transfer window, without either the player or the club automatically having to pay compensation.
That could also have an impact on transfer fees, with clubs possibly being less willing to splash out huge sums on players who would have more power to leave at any point if they did not wish to fulfill their contracts.
Similarly, it could have a negative impact on players too, with clubs potentially being wary of offering sky-high wages due to a lack of security over their ability to prevent that player from leaving.
FIFA is expected to put forward new regulations in response to this ruling, however, which should make the potential ramifications of the case clearer.
A new body is also likely to be created that will decide what, if any, compensation is owed to a club, and by whom, in such cases.
Will the Premier League be affected?
Although the CJEU's decision specifically relates and refers to freedom of movement within the EU bloc, and the United Kingdom is no longer part of the European Union, it is likely to have an impact on the Premier League too.
Any change to FIFA rules would affect the Premier League, and as by far the biggest spenders in world football, any knock-on impact to transfer fees could be felt more keenly in the English top flight than anywhere else too.