The Nepalese fighters claimed their human rights had been breached by "irrational and discriminatory" treatment at the hands of the British Army. Their pay, conditions and treatment were also inferior to those enjoyed by British-born soliders, it was alleged.
Cherie Booth QC told the court that there had been "systematic and institutionalised less favourable treatment of Gurkha soldiers".
But Mr Justice Sullivan said the differences in pay and pensions were not significant enough to be described as irrational or discriminatory and refused the Gurkhas permission to appeal.
Lawyers for the Gurkha soldiers had predicted that as many as 30,000 claims could have been brought against the Ministry of Defence if the test cases had been a success.