Objectors have warned that large areas along the route could be unnecessarily hit by a costly planning blight for an indefinite period.
The latest legal challenge concerns the London-Birmingham Phase 1 section of the scheme.
The Government was accused of unlawfully failing to carry out a strategic environmental assessment (SEA) which might help to alleviate problems being caused by the flagship scheme for local people and businesses.
But three appeal judges today unanimously rejected the challenge.
At a hearing last month David Elvin QC argued that an SEA was required before ”safeguarding directions” could be made by the Transport Secretary to protect Phase 1 land from local councils giving planning permission for other, conflicting developments.
Mr Elvin, representing the HS2 Action Alliance (HS2AA) and Hillingdon Council in west London – which are both campaigning against the current scheme – said ”generous” areas of land extending beyond the route were protected because they might be required for temporary storage of spoil, or for compounds, work accesses or other functions in relation to the project.
The land had been included without any proper debate or assessment of environmental impacts or alternative options, he argued.
Mr Elvin said: ”The effect of this is to blight development in the land covered by the direction for an indefinite period – and without an SEA which might have enabled the impacts to be minimised or avoided.
After the ruling Transport Secretary Patrick McLoughlin made a plea for HS2 opponents, who have mounted over a score of legal challenges, to end their “fruitless” court cases.Mr McLoughlin said: “The courts have once again rejected a legal challenge against HS2 as they have done on repeated occasions.
“The Government has now won 20 out of 21 challenges to the project.
“The House of Commons has approved the hybrid Bill (paving the way for HS2) in a vote of 452 to 41.
“I invite interested groups to work with us to make HS2 the very best it can be, and not waste more public money on costly and fruitless court cases.
“HS2 will deliver jobs, skills and free up space on our congested network for more trains and more passengers, that is why we are continuing to press ahead with the Parliamentary process which will ensure spades in the ground by 2017.”
The appeal was against a decision of High Court judge Mr Justice Lindblom in August to throw out the campaigners’ case.
Lord Justice Sullivan said the appeal court was dismissing the campaigner’s appeal for reasons which “largely echoed” those given in the High Court.
He said the Government was pursuing HS2 through “specific legislation” in Parliament and not through any “plan or programme” affected by the European Directive on SEAs.
The judge said It was “not realistic” to describe the Government’s safeguarding directions, which had the sole aim of ensuring HS2 could be implemented, “as some form of plan or programme in their own right”.