A High Court judge, who ruled in favour of campaigners opposed to the A5 scheme due to a breach of the habitats directive, was told the Department for Regional Development now wants time to carry out an appropriate assessment.
With an appeal against his verdict also being prepared, he adjourned the application for a stay until senior counsel for the department is available.
The group of farmers, landowners and business people who brought the challenge to work on 85km stretches between Derry and Aughnacloy, Co Tyrone have hit out at the legal move.
In a statement, the Alternative A5 Alliance said: "We are delighted that Mr Justice Stephens has ruled in our favour but we are disappointed and bemused that the scheme orders have not been quashed, particularly as Roads Service has accepted that should happen.
"We think Roads Service's attempt to have the quashing stayed is entirely unacceptable and is an attempt to get round the clear legal requirements of the habitats directive."
The scheme, the largest of its kind ever in Northern Ireland, forms part of a proposed key cross-border business route linking Dublin and the north west.
Uncertainty surrounds the overall project after the Irish Government downgraded funding due to its tough economic circumstances.
Judicial review proceedings centred on the decision to press ahead with two sections of the route, for which the Stormont Executive has approved £280m.
Lawyers for the Alliance claimed it has now become a different project, and that no proper environmental impact assessment (EIA) has been carried out.
In his judgment last week, Mr Justice Stephens dismissed all but one of the campaign group's claims.
He held there had been a failure to carry out an appropriate assessment of the Rivers Foyle and Finn, which are Special Areas of Conservation under the habitats directive.
It had been conceded during the hearing that such a finding should lead to a quashing order.
But in court on Wednesday, lawyers for the department confirmed they wanted a stay to allow an appropriate assessment to be carried out.
An appeal against the verdict is also to be mounted. However, senior counsel for the department was not available to put forward arguments at this stage.
On that basis, Mr Justice Stephens agreed to adjourn proceedings until 12 April.
Gregory Jones QC, for the Alliance, expressed disappointment at the department's "behaviour".
He also told the judge: "My clients have come a long way this morning and left at early hours for a matter of the gravest importance to them, to be told 'no, the orders are going to remain in place' when Your Lordship has found they are unlawful and in breach of European law."
Mr Jones then sought and received an undertaking from the Department that all work on the scheme would stop unless any landowners wanted it to continue.
Adjourning the case until next month, the judge awarded costs of Wednesday's hearing to the Alliance and ordered a full explanation for the late notification of the department's position.
Outside the court, the campaign group's statement added: "In the meantime Roads Service's unlawful occupation of landowners' farms and property continues.
"We are grateful that the court has required that all further works on the scheme must stop immediately. This will halt the swathe of destruction carried out by the Roads Service since September 11, 2012."