Judge Gilmar Mendes granted the injunction requested by the Popular Socialist Party, one of 13 requests sent to the Supreme Court on Thursday questioning the legality of the Cabinet appointment, according to Agencia Brasil.
The ruling represents the latest twist in a legal tug-of-war that has gripped the nation.
But none of this represents the final word on whether the once wildly popular Brazilian leader known as Lula will have a new job -- and new protections in a corruption investigation -- in the Cabinet of Rousseff.
Earlier, a judge's injunction barring Lula da Silva from becoming chief of staff was overturned.
That decision by Judge Candido Ribeiro, the head of the Federal Regional Court of the 1st Region in Brasilia, reversed an injunction issued earlier by another federal judge, according to a statement issued late Thursday by Brazil's federal courts.
More court battles mean no clear end in sight on a topic that has only sharpened political divides in Brazil. And this means the country's leaders, past and present -- rather than gearing up for what was supposed to be a crowning achievement, as the continent's first nation to host an Olympics this summer
-- will be busy dealing with the fallout.
Lula da Silva can appeal the latest decision before the full Supreme Federal Court.
Police step in amid widespread protests
Already, there's been significant unrest, which doesn't seem likely to abate anytime soon.
Hundreds of thousands
turned out Sunday to call for the resignation of Rousseff, who is resoundingly unpopular in Brazil because of its faltering economy and corruption even before the Lula da Silva allegations surfaced.
The streets of major Brazilian cities filled again with protesters Wednesday night, some of them violent. State-run news reported that police used rubber bullets, tear gas and pepper spray to break up protesters who had been throwing cans outside the Presidential Palace in Brasilia.
The Presidential Palace was ground zero again Thursday.
Inside, Rousseff swore in Lula da Silva as her chief off staff. Outside, military police had to step in and three people were arrested after pro- and anti-government factions clashed in front of the same building, according to state news. Authorities also used tear gas and pepper spray Thursday evening to disperse protesters in the same location.
Other cities, like Sao Paulo, also saw vibrant, colorful and emotional protests Thursday.
And Friday was more of the same, though not all were without conflict. In Sao Paulo, Brazil's most populous city, Sao Paulo, police used water cannons to prevent demonstrators from blocking a main road.
Once popular president focus of corruption probe
One irony of all this is that Lula da Silva was once a symbol of pride and unity for most all Brazilians. He left the presidency on January 1, 2011, after two terms, with a 90% approval rating.
Since then, he underwent chemotherapy to treat a malignant tumor
in his larynx before revealing, in February 2012, that his cancer was in remission.
But his reputation took a hit earlier this month, when authorities searched
his home in Sao Bernardo do Campo, the Lula Institute in Sao Paulo, his son's home and others, federal police in the city of Curitiba told reporters.
Federal prosecutors alleged Lula da Silva benefited from a bribery scheme involving state-owned oil company Petrobras while he was president and after leaving office.
The former leader -- who had flirted with the idea of running for president again in 2018 -- has defiantly denied these allegations.
Rousseff backs her predecessor
And he has gotten backing from Rousseff, who herself is the subject of impeachment proceedings opened
in Congress over alleged attempts to hide budget shortfalls before the 2014 elections.
This backing is perhaps not surprising, considering that Rousseff had served as Lula da Silva's chief of staff. Rousseff has not yet been charged or even investigated personally, but she chaired Petrobras during much of the time the alleged corruption occurred. Moreover, her close ties to Lula da Silva and the fact the Worker's Party they both belong to is ensnared in the sweeping graft probe -- an operation known as "Car Wash" -- means they do share a common interest in beating down these allegations.
On Friday, Mendes decided the processes involving the "Car Wash" corruption investigation should be returned to Federal Judge Sergio Moro, who has been heading up the case, Agencia Brasil reported.
Rousseff has said she wants Lula da Silva heading her staff not because of anything to do with this corruption investigation but because she wants to tap his expertise.
Others think the appointment is meant to stall court proceedings against Lula da Silva, because senior political figures can only be tried in the Supreme Federal Court. A judge on Wednesday released secretly recorded phone conversations between Lula da Silva and Rousseff.
Christopher Sabatini, an adjunct professor at Columbia University's School of International and Public Affairs, thinks "the timing of it does not smell right."
"The risk is that doubling down on this strategy is only going to really stain this administration even more," Sabatini said.