Blatter will still have to serve his six-year ban after CAS refused to sanction a reduction.
In December 2015, Blatter, along with ex-UEFA President Michel Platini, was banned eight years from all football-related activities over ethics issues, ending his 17-year-reign at the apex of the world football governing body. The ban was later reduced to six years by FIFA'a Appeals Committee.
In a final attempt to redeem himself, the embattled Swiss then sent his case to CAS, whose panel on Monday ruled that the six-year ban "was not disproportionate."
Blatter, 80, was found to have breached FIFA ethics by making a £1.3m «disloyal payment» to ex-UEFA boss Michel Platini in 2011.
Both men have formally denied any wrongdoing regarding the transaction. They claim the payment was for "consultancy work" that Platini had done for Blatter between 1998 and 2002, and that they had had a 'gentleman's agreement' on when it was going to be made.
CAS said in its verdict on Monday that the payment was an "undue gift which had "no contractual basis."
In an interesting twist, CAS also revealed that Blatter had not applied for a reduction of the ban, but requested for an "annulment"altogether.
Blatter however accepted the ruling, saying, «no other verdict could be expected".
"I have to accept this decision. I have experienced much in my 41 years in Fifa. I mostly learned that you can win in sport, but you can also lose," he added.
In May this year, CAS had reduced Platini's ban to four years after the Frenchman had made an appeal to have the ban overturned.
A three-man CAS panel had said they were still "not convinced by the legitimacy" of the payment Blatter made to the 61-year-old.