The Gulf state's supreme court, whose verdicts are final, upheld the jail term against Nabeel Rajab, his second imprisonment verdict this year, for criticising the Sunni-ruled monarchy on social media, a judicial source said.
Rights groups were swift to condemn the latest verdict -- which is final and cannot be challenged.
Amnesty International declared Rajab a "prisoner of conscience" and said the sentence was a "travesty of justice" and "utterly outrageous".
The London-based Bahrain Institute for Rights and Democracy said the verdict "illustrates that Bahrain's corrupt political system sought to continue his (Rajab) political persecution".
Rajab, a high-profile rights activist who is already serving a two-year term in another case, was first handed the sentence in February by a lower court and an appeals court confirmed it in June.
He was convicted of insulting the state by "deliberately disseminating", false and malicious news on social media.
Rajab was also convicted of criticising the Saudi-led military campaign in Yemen and publicly offending a foreign country, a reference to Saudi Arabia.
The court convicted him of endangering Bahrain's military operations in Yemen. Manama is part of the Saudi-led coalition that has been fighting the Iran-aligned Huthi rebels since March 2015.
He also tweeted criticism of the Bahraini government's treatment of prisoners.
In January this year, the same court upheld a two-year imprisonment against Rajab after convicting him of press statements critical to the government.
'A complete farce'
Rights groups poured scorn on Monday's final verdict and called for Rajab's immediate release.
"The decision to uphold Nabeel Rajab's conviction and five-year sentence simply for posting tweets expressing his opinions, exposes Bahrain's justice system as a complete farce," Amnesty International said in a statement.
"Nabeel Rajab is a prisoner of conscience. It is utterly outrageous that he has already spent two years behind bars -- including nine agonising months in solitary confinement, amounting to torture."
It said Bahraini authorities should have quashed his conviction and sentence and released him immediately and unconditionally.
The Bahrain Institute for Rights and Democracy echoed Amnesty.
"By arranging the final verdict to fall during the holidays, a time when international attention will be minimal, the intentions of Bahrain's rulers have been made clear. This appears to be a planned outcome, prepared well in advance," it said in a statement.
About 127 non-governmental rights groups urged Bahrain in August to "immediately release" Rajab after the United Nations denounced the Shiite opposition leader's detention as "arbitrary" and "discriminatory".
Bahrain is mostly Shiite Muslim according to unofficial estimates contested by the government.
The country -- which is home to the US Navy's Fifth Fleet and a British military base -- is located between regional rivals Saudi Arabia and Iran and has been ruled for more than two centuries by the Al-Khalifa dynasty.
Authorities have jailed dozens of high-profile activists and disbanded both religious and secular opposition groups since Shiite-led protests demanding political change erupted in 2011.
They have stripped hundreds of those convicted of their citizenship, leaving many stateless.
In March, authorities announced they would be taking "severe measures" to track down dissidents who use social media, as Bahrain tightens its grip on political opposition.
Social networking sites, notably Twitter, are a major platform for rights activists in the tiny kingdom.