Maligned plans to demolish historic Athlone House on the edge of Hampstead Heath have today been rejected by a planning inspector in a landmark victory for the 5,000 campaigners who fought for years to save the former hospital.

The mysterious foreign billionaire owners of Athlone House sought to knock down the Victorian mansion and replace it with an opulent eight-bedroom family home with basement car park, swimming pool and ballroom.

The plans were dubbed an “Arabian nightmare” by community groups in Hampstead and Highgate.

More than 5,000 people joined the impassioned fight to save the former RAF intelligence base from demolition – including Monty Python legend Terry Gilliam.

And today, they are celebrating the landmark decision by planning inspector Colin Ball to reject an appeal to demolish the mansion and replace it with a £80million super-home.

Campaigners have been fighting attempts to knock down the house since 2009.

A jubilant Michael Hammerson, who led the fight to save the mansion as part of the Athlone house Working Group, said: “This is a hammer blow against the developers.

“The relief is enormous. It has been a shadow over our heads for many years. Would it be too much now to expect the developers to come to us and discuss a proper restoration campaign?”

In his appeal decision, planning inspector Colin Ball described the proposals as “inappropriate” and potentially “harmful” to Hampstead Heath.

A spokesman for Athlone House said: “This is a very disappointing decision. We will be looking carefully at the inspector’s decision before deciding the next steps.”