The British Prime Minister was defeated on an amendment to the European Union Withdrawal Bill by four votes, in her first major House of Commons bruising yesterday.
MPs from across different parties voted in favour of Parliament being given a meaningful vote on the terms of Brexit by 309 votes to 305.
Conservative party rebels had made common cause with Opposition Labour MPs on a highly contentious issue.
It also gives ministers powers to amend the laws as they move across, to address any technical glitches.
The government remained defiant following the defeat.
"We are disappointed that Parliament has voted for this amendment despite the strong assurances that we have set out. We are as clear as ever that this Bill, and the powers within it, are essential," a UK government spokesperson said.
"This amendment does not prevent us from preparing our statute book for exit day. We will now determine whether further changes are needed to the Bill to ensure it fulfils its vital purpose," the spokesperson added.
Former UK attorney general Dominic Grieve, who had brought the amendment, told the Commons he intended to put the "country before his party" amid concerns over the potential for the flagship Brexit legislation to become a "very worrying tool of executive power".
Ministers admitted last night's defeat was a "significant setback" but insisted it would not frustrate the Brexit process.
However, Labour leader Jeremy Corbyn described it as a "humiliating loss of authority" for the Prime Minister ahead of her trip to Brussels, where she hopes EU leaders will approve the start of Brexit trade talks.
Meanwhile, Brexiteer MP Nadine Dorries demanded the 11 rebels be "deselected and never allowed to stand as a Tory MP ever again".
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