A backlash from the Jewish community and Labour parliamentarians saw him re-suspended in July.
Mr Williamson crowdfunded a legal challenge to his suspension but on Thursday the High Court ruled he should not be readmitted.
This will likely preclude him from standing as a Labour candidate in a general election until he is reinstated by the party.
A Labour spokesman said: "The court has upheld Chris Williamson’s suspension from the Party and has said his disciplinary case must run its course."
Board of Deputies President Marie van der Zyl said: “The High Court’s rejection of Chris Williamson’s bid for reinstatement leaves two remaining questions: Why Labour took so long to suspend him in the first place and why he has not yet been booted out.
"This serial baiter of the Jewish community must now be expelled from the Labour Party without any further delay.”
