Mary Ward, who was born in Ripon, founded an order of nuns in the 17th Century but it was rejected by the Pope and she was accused of heresy.
Pope Benedict has now approved a decree recognising her "heroic virtues", giving her the title "venerable".
Her cause will now go to the next stage in the process towards canonization.
Mary Ward's order of nuns was recognised by the church in 1877, more than 200 years after her death, and exists today worldwide under the names Congregation of Jesus and Institute of the Blessed Virgin Mary.
Sister Gemma Simmons, a member of the Congregation of Jesus, said: "Mary Ward's ideal of an active congregation of religious women serving the needs of the church was too advanced for her time.
"She suffered at the hands of authorities who in different circumstances might have recognised the need for such a congregation."
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SIC: BBC