Gadgets such as iTrips, which transmit MP3 players' output so they can be heard on FM radios, are set to become legal in the UK.
The use of the devices is currently banned in Europe, though this is based on 1940s legislation.
The Wireless Telegraphy Act of 1949 forbids the use of radio equipment without a licence or an exemption.
The reason given is their low-power transmissions have the potential to interfere with legal stations.
However, the devices are widely available online, and are hugely popular with people who own MP3 players.
Communications regulator Ofcom is holding a public consultation over the issue until September, and it is expected the devices will become legal to own without a licence by next year.
Liberal Democrat culture, media and sport spokesman Don Foster told BBC News: "I am delighted Ofcom have ended this ludicrous ban, based on 1940s legislation... which threatened two years imprisonment to music lovers using iTrips.
"This decision... will not only regulate a booming black market and provide the country with valuable tax revenue, but also enable the iPod generation to enjoy their music using the latest gadgets."
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