The dispute centres on the 2.5-metre-tall shed at his Hampstead home.
The legendary guitarist put up the structure in the garden of his Hampstead home to replace a former shed and summerhouse.
But after he made a retrospective planning application, neighbours called it “overbearing” and “intrusive”.
However, Hampstead Hill Gardens Residents’ Association argued the shed was built directly against the boundary, rather than on its original footprint two metres away.
Audrey Mandela, chairwoman of the association, said: “The application should be rejected as the structure now in place is obtrusive, overbearing, and significantly more visually and physically intrusive than what was originally approved or what stood there before.
“The decision we hope the council will make is to remove it as soon as possible to stop the continued harm to neighbourhood amenity.
“It would seem that this is not a minor or technical oversight but a deliberate repositioning of the structure that would not have received permission.”
Gilmour made amendments to the plans and pledged to relocate it 2.5 metres away.
Camden Council has now ordered Mr Gilmour to take down the shed and rebuild it 2.5 metres from the end of his garden within four weeks.
A spokesman for Camden Council said: “The existing, unlawfully-sited garden shed shall be removed from the rear garden within one month of the date of this approval, otherwise it will be the subject of enforcement action to obtain its removal.”
Mr Gilmour’s planning agents, Whiteacre Planning, argued the shed was not causing harm.
The spokesman said: “It is important that new development ensures that there is no adverse impact on neighbouring amenities such as overlooking, loss of privacy, or overshadowing.
“Although the roof of the shed is above the height of the boundary fence, it will not lead to any overlooking, loss of privacy or overshadowing.
“Single-storey buildings seldom, by definition, lead to amenity issues.”
