The UK Border Agency (UKBA) will appeal against a ruling preventing the deportation of an asylum-seeker who left a girl dying under a car.
Immigration Minister Damian Green made the announcement hours after the prime minister expressed anger at the case.
Iraqi Kurd Aso Mohammed Ibrahim was jailed for four months after knocking down Amy Houston in Blackburn in 2003.
On Thursday, the 33-year-old was told he could remain in the UK as he had fathered children there.
In a statement issued by the Home Office, Mr Green said: "We are extremely disappointed at the tribunal's decision and are appealing.
"He was convicted of committing an offence that led to the tragic death of a 12-year-old child and it is our view that he should be removed."
'Years of hell'
Earlier, David Cameron said he hoped there would be a successful appeal against the ruling by the Upper Tribunal of the Immigration and Asylum Chamber on Thursday.
He said: "My personal response is one of great anger that this is allowed to happen.
"Here we have an Iraqi asylum seeker convicted of an offence that led to the death of a child and yet we are being told that there is no way that this person can be deported to Iraq."
Ibrahim was convicted of driving while disqualified and failing to stop after the accident. He also had previous convictions.
He had two children after his release from prison.
Amy's father Paul, 41, from Darwen in Lancashire, has conducted a seven-year legal battle to have him deported.
Last month he urged immigration judges to bring his "years of hell" to an end.
But two senior immigration judges, sitting in Manchester, rejected the appeal after lawyers said that human rights laws permitted Ibrahim to remain in the country on the grounds of his right to life and to family life.
Mr Houston described the decision as perverse and said it showed the laws worked in favour of criminals over victims.
Speaking about the appeal, he said: "Hopefully this will be a springboard and I will finally get an opportunity to put my viewpoints across to the judges."
Mr Cameron said Iraq should not be seen as a country to which it was too dangerous to deport people.
"Britain has spent billions of pounds and lost many, many very good people - some killed, some wounded - to make Iraq a safer, more stable country," he said.
"We should not be in a position where, having done all these things, we are simply told it is not possible to return a person there."
Mr Cameron said the European Convention on Human Rights said nothing about deportation, and that legal interpretations by judges and lawyers sometimes "fly in the face of common sense".