Bullfighting is banned in most of the country but not in some southern regions where proponents say it brings in tourist money and is a cultural tradition.
CRAC and DDA, animal rights groups in France, had asked the council to impose the ban nationwide, Radio France Internationale reported. RFI quoted one poll as saying two-thirds of French people would prefer to ban bullfighting completely.
The council said the decision to allow bullfighting in the south was "precise, objective and rational," and "these traditional practices thus authorized do not infringe upon constitutional rights."
Interior Minister Manuel Valls said bullfighting is a tradition that should be saved.
"It's something I love, it's part of my family's culture," he said. "It's a culture that we have to preserve."
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