A spokesman for the Jakarta court also said on Monday that Bashir's prison sentence, handed down in September, had been reduced to three years from four.
Lawyers for Bashir said they had not received notification from the court on the appeal and would still fight for his release.
Security hawks in the West, as well as in neighbouring countries such as Singapore, had attacked the original four-year sentence as too light.
A Jakarta lower court ruled in September that Bashir, accused of being the spiritual leader of the Jemaah Islamiya Muslim organisation, at least knew the group existed, and convicted him of treason and other charges.
But it said allegations that Bashir led Jemaah Islamiya, blamed for actual and planned violence throughout the region, were unproven.
Other charges upheld
The appellate court, in a ruling announced on Monday, overturned the treason conviction, but upheld charges of forging documents and violating immigration laws, the spokesman said.
"The high court has decided the defendant has to be punished for three years," said high court spokesman Hasan Basri, who said the ruling was reached last month, but not announced.
"The defendant has been proven guilty of forging documents, and getting in and out of Indonesia without going through immigration. However, on the charge of toppling the government that was ruled proven by the lower court, the appeals panel ruled that it was not proven," he told reporters.
Sidney Jones, Indonesia project director for the International Crisis Group think-tank, said the ruling could make the conviction of other Islamist dissident suspects harder.
"It's an unfortunate decision by the appeals court because it's going to make it much more difficult for Indonesian prosecutors to convict members of Jemaah Islamiya simply for their role in the organisation," Jones said.
"We have this person now behind bars ... through a legal means. Some countries have put away people behind bars but not through the same legal process"
foreign ministry spokesman
The Jemaah Islamiya is suspected of being al-Qaida's arm in Southeast Asia, and accused of being behind the Bali bombings last year that killed 202 people.
It has also been blamed for an attack on the Marriott Hotel in Jakarta in August, which killed 12.
Not only the defence, but prosecutors seeking a stiffer sentence had appealed the original decision, which could still be changed by the supreme court if the appeals process continues.
There is still room for "the prosecutors to appeal. The legal process has not yet been exhausted", said foreign ministry spokesman Marty Natalegawa.
"Whatever the standard, one must not lose sight that we have an Abu Bakar Bashir who is behind bars for lesser crimes. We have this person now behind bars for potentially three years through a legal means," he said.
"Some countries have put away people behind bars but not through the same legal process."
Indonesia's neighbours, Singapore and Malaysia have used draconian internal security laws to hold suspected Jemaah Islamiya members indefinitely without trial.