The South London club won the FA Cup, their first major trophy, last season and earned a place in Europe's secondary club competition as a result, but lost that spot in July after falling foul of multi-club ownership rules, which state that teams with the same owners cannot face each other in the same tournament.
The FA Cup winners launched an appeal against UEFA, Lyon, and Nottingham Forest in July but the CAS announced today that it had been dismissed.
"The Panel also dismissed the argument by CPFC that they received unfair treatment in comparison to Nottingham Forest and OL. The Panel considered that the UEFA Regulations are clear and do not provide flexibility to clubs that are non-compliant on the assessment date, as CPFC claimed."
Nottingham Forest, who finished seventh in the Premier League last term and reported Palace to UEFA, will replace Oliver Glasner's side in the Europa League and be part of the draw for the League Phase at the end of the month.
On Tuesday, Crystal Palace published a statement in response to the decision and outlined their frustration.
"When we won the FA Cup against Manchester City on that momentous day in May, our manager and players earned the right to play Europa League football.
"It appears that certain clubs, organisations and individuals have a unique privilege and power.
"Multi-club structures hide behind the charade of a “blind trust” while clubs such as ours, who have no connection to another club whatsoever, are prevented from playing in the same competition.
"While we respect the CAS tribunal members, the process is designed to severely restrict and, in our case, make it almost impossible to receive a fair hearing.
"UEFA’s decision has wider implications for the governance of the sport. A combination of poorly conceived regulations and their unequal application means our brilliant fans will be deprived of the chance to watch this team compete in the Europa League for the first time in our history.
"UEFA must fulfil its mandate to pass coherent rules which are properly communicated and applied, with reasonable cure periods to resolve uncertainty and consistent sanctions, treating all clubs equally with a proper appeal process.
"Although we continue to take legal advice on the next steps, we will compete in the Conference League with the same determination and will to win that characterises this incredible club."
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