The Department of Justice had sought an injunction that would prevent Bolton's publisher, along with thousands of distributors and bookstores already in possession of the book, from releasing it.
But D.C. District Judge Royce Lamberth ruled he would not stop publication even while noting Bolton's conduct "raises grave national security concerns" and without White House clearance he "has exposed his country to harm and himself to civil (and potentially criminal) liability."
"For reasons that hardly need to be stated, the Court will not order a nationwide seizure and destruction of a political memoir," Lamberth said in his ruling. "This was Bolton's bet: If he is right and the book does not contain classified information, he keeps the upside mentioned above; but if he is wrong, he stands to lose his profits from the book deal, exposes himself to criminal liability, and imperils national security. Bolton was wrong."
President Trump took to Twitter to claim victory, zeroing in on Lamberth's comments that Bolton may have unlawfully disclosed classified information.
"BIG COURT WIN against Bolton. Obviously, with the book already given out and leaked to many people and the media, nothing the highly respected Judge could have done about stopping it...BUT, strong & powerful statements & rulings on MONEY & on BREAKING CLASSIFICATION were made," Trump tweeted.
"Bolton broke the law and has been called out and rebuked for so doing, with a really big price to pay. He likes dropping bombs on people, and killing them. Now he will have bombs dropped on him!" he added.
Bolton's attorney said in a statement to ABC News they "welcome" the decision overall but "respectfully take issue, however, with the Court's preliminary conclusion at this early stage of the case that Ambassador Bolton did not comply fully with his contractual prepublication obligation to the Government, and the case will now proceed to development of the full record on that issue."
It's likely not the end of Bolton's legal troubles.
The Justice Department at a minimum is expected to seek to seize the profits from his book -- which already came with a reported $2 million deal -- and potentially pursue criminal charges under the Espionage Act for divulging classified information, according to a person familiar with the matter.
Bolton, meanwhile, has repeatedly disputed that his book contains any classified information following multiple revisions over the course of a months-long review by the National Security Council.
The NSC official tasked with prepublication review, Ellen Knight, by April 27, 2020, "had completed her review and was of the judgment that the manuscript draft did not contain classified information," according to the court complaint.
It was months later after further review by Michael Ellis, another NSC official, that Bolton was informed the council concluded there was additional classified information that needed to be redacted from his book, delivering a letter to him only last Tuesday identifying six passages.
The government says Bolton acted unlawfully by going ahead with publication before the review had been completed. Bolton says he acted in reliance on Knight's conclusion that any classified information had been removed.
A spokesperson for Simon & Schuster in a statement called the government's filing "a frivolous, politically motivated exercise in futility."
"Hundreds of thousands of copies of John Bolton's 'The Room Where it Happened' have already been distributed around the country and the world. The injunction as requested by the government would accomplish nothing," a statement from last week reads.
Notably, several excerpts of the book have already made their way online, which Lamberth acknowledged, and the book is a number one seller on Amazon.
In an exclusive interview with ABC News' Chief Global Affairs Correspondent Martha Raddatz, Bolton predicted Trump's response to the book would be "volcanic."
"It's typical of the Trump administration that when faced with criticism, they don't deal with the substance of the criticism, they attack the person, which I fully expect and doesn't surprise me," he said.
President Trump has called Bolton a "wacko" and "liar," among other names, leading up to the book's official release on Tuesday, June 23, in which Bolton calls the president "stunningly uninformed."
Raddatz directly asked Bolton in the interview if he feared being prosecuted.
"I feel very confident after going through four months of page by page, line by line prepublication review, that there's no classified information in the book," Bolton said.
Bolton has called Trump's attacks on him "unbecoming of the office of president."
"The president isn't worried about foreign governments reading this book," Bolton said. "He's worried about the American people reading this book."
In another interview with ABC News' Chief Anchor George Stephanopoulos on Monday, Bolton declined to say if he would testify now if subpoenaed by Congress and instead turned attention to November's presidential election.
"The primary way we rein presidents in is not through impeachment," Bolton argued. "It's through elections and presidential behavior can be reckless, reprehensible, dangerous."
ABC News' Alexander Mallin, Katherine Faulders and Conor Finnegan contributed to this report.