The Government is being urged to "address the crisis in local councils' funding" hitting disabled people and their families.
Learning disability charity Mencap spoke out after two families from Newbury won a High Court battle over a cash-strapped council's decision to cut spending on services which allow parents with disabled children to take a break.
Mrs Justice Elisabeth Laing, sitting in London, ruled the local authority had unlawfully cut its "short breaks" services.
The judge described how West Berkshire Council had faced "an exceptionally difficult financial position" because of budget reductions imposed by central government.
That position got worse in March this year and one of the council's cost-saving measures was to cut its short breaks budget by up to £215,000.
Having already made £36 million in savings over the last six years, West Berkshire was to receive 44% less revenue support grant in 2016-17 under a new funding formula - "the third largest cut for any English unitary authority," said the judge.
But she said the council was under a legal duty to provide services to assist individuals providing care for disabled children.
The authority had failed in that duty because there was "no trace" of councillors having been told of the need to take into account the needs of carers who would be unable to continue with their role without the occasional short break.
Rossanna Trudgian, Mencap's head of campaigns, said: "Today's judgment should be a reminder of the damaging effects cuts to local council funding from central government can have on the needs of disabled children, and that the support they are entitled to should be protected."
Ms Trudgian added it should also be "a warning for the Government to address the crisis in local councils' funding, in order to protect the support disabled people and their families rely on so desperately".
She said: "Short breaks are a lifeline for many families who care 24 hours a day, seven days a week for their loved ones with a disability."
The demands of caring were pushing many families "into moments of crisis" with eight out of 10 reporting they had come close to breaking point due to a lack of short breaks.
Ms Trudgian said: "Despite this a Mencap report in 2013 revealed more than half of councils have cut spending on short breaks for families, and the trend appears to show no sign of reversing."
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