The decision upholds a 2022 Tokyo district court ruling that found the ban in a "state of unconstitutionality."
Seven plaintiffs filed the suit, arguing existing civil law provisions violate constitutional guarantees of marriage freedom and equality.
The high court also upheld a lower court's rejection of the plaintiffs' claim for 1 million yen (US$6,500) each in damages.
This latest ruling follows similar decisions in other jurisdictions, including one by the Sapporo High Court earlier this year.
Japan remains the only G7 nation that does not legally recognize same-sex unions, with Article 24 of the Constitution at the center of debate due to its reference to marriage requiring "mutual consent of both sexes."
