A federal judge has lifted a 10-year-old consent decree barring Citicorp from owning Carte Blanche Corp., the third largest travel and entertainment card company, and opened the way for its reacquisition from Avco Corp., its present owner.

The 1968 consent decree was entered into with the Justice Department which required Citicorp to divest its 50 percent interest on antitrust grounds. On May 9 of this year Citicorp moved to vacate that decree, and the government took the position that it now would not oppose such a motion.

The motion, however, was opposed by American Express Corp., the dominant travel and entertainment card system, on the grounds that it would not be in the public interest because Citicorp already participates in the two major bank card systems, Visa and Master Charge.

But U.S. District Court Judge John M. Canella ruled this week that lifting the degree "would be in the public interest." He noted that Citicorp "does not control either bank card."

And he pointed out that Citicorp, which is the holding company for the world's second largest bank, had started an antitrust suit against Interbank Card Association and MCTC Corp., which runs Master Charge, seeking to stop it from issuing travellers checks in what it claims would be unfair competition with its own First National City Bank Travelers Checks.

Canella also told American Express it could bring its own private antitrust suit against Citicorp if it felt competition had been restrained by the Carte Blanche acquisition.

"We are pleased that the court has ruled in our favor," a spokesman for Citicorp said. "And we plan to take the necessary steps to acquire Carte Blanche as soon as possible."

A spokesman for American Express said the company continued to feel its position was correct, but "our people aren't particularly considering suing." He added, however, that American Express would be watching Interbank's counterclaim against the Citicorp suit in which Interbank is also challenging the Carte Blanche acquisition on antitrust grounds.