Egypt’s Muslim Brotherhood lost an appeal against a court decision to ban the group, Al Arabiya reported Wednesday.
The verdict bans all of the group’s activities and includes seizing its funds.
In September, an Egyptian court ordered a ban on the group, following the military-led ouster of Islamist President Mohammed Morsi in July.
The ban on the group accompanied a campaign by security forces to crush the Islamist movement in which hundreds of its members have been killed and thousands arrested.
Daily "anti-coup" demonstrations, calling for Morsi’s reinstatement, have recently been held on university campuses, some of which have escalated into violent conflict. Last week, police stormed the Al-Azhar University campus in Cairo to disperse student protests after clashes erupted with staff members.
In August, police forcibly dispersed two pro-Morsi sit-ins in Cairo leaving hundreds dead. Since then, many of the group's members have been arrested, with some put on trial on charges of inciting violence.
Wednesday's decision was another political blow to the group, which was outlawed for years under presidents Anwar Sadat and Hosni Mubarak, but which swept into power in the chaos that ensued after Mubarak was ousted in 2011.
“In its scheduled session today, the Cairo Urgent Cases court dismissed an appeal raised by the Muslim Brotherhood to stop the execution of the previous order banning the activities of the group,” state news agency MENA reported, according to Al Arabiya.
The military-installed government has promised new elections next year which foreign governments say must include all political factions to mark a credible return to democracy. The court ruling indicated the Brotherhood was likely to be excluded.
Morsi’s trial began on Monday, but the first session was halted shortly after it began and will not resume until January 8.
The panel of judges trying Morsi ended the court session after Morsi refused to wear a prisoner's uniform and due to in-court disruption by the defendants, who were chanting "illegal, illegal.”
Morsi and 14 other Muslim Brotherhood figures face charges of inciting the killing of protesters outside the presidential palace in 2012, when he was president.