The 11-judge panel rejected 12 petitions by Israeli opponents to the withdrawal from all Gaza Strip and four West Bank settlements, ruling the pullout does not violate the settlers' human rights.
On Thursday, 10 of the judges ruled the plan was constitutional. The minority opinion of one judge said it was illegal and should be cancelled.
Yoram Sheftel, an attorney for the settlers, said his expectations were low because the Supreme Court has a tendency of ruling against Jewish settlers.
"We didn't expect anything from this court since the petitioners are Jews and patriots," Sheftel said. "This was fully expected. There's no surprise. I'm not disappointed because we didn't have any expectations."
Israeli Justice Minister Tzipi Livni praised the court's decision, and expressed hope the ruling would defuse settler resistance to the evacuation, which is expected to be fierce.
"We didn't expect anything from this court since the petitioners are Jews and patriots"
Attorney for settlers
"I hope this ruling sends a message to the lone settler that the plan is going ahead," Livni told Israel's Army Radio.
Aljazeera's correspondent in Ram Allah, Walid al-Umari, reported that settlers demonstrated after the decision, closing shops, government offices, institutions and main roads.
Meanwhile, a former Israeli chief rabbi who has been a fierce opponent of the planned pullout called on settlers on Thursday not to use force to prevent their evacuation by security forces.
Former Sephardi chief rabbi Mordechai Eliyahu, one of the most influential figures in religious Zionism, also called on soldiers not to refuse orders to carry out the disengagement project.
"We must not get in a situation in which one Jew raises his hand against another," Eliyahu said in an interview with private Channel 2 television.
Opinion polls show public support
for the pullout plan is dropping
The army and police will jointly carry out the operation to relocate the 8000 settlers of Gaza in an operation which is due to start in mid-August.
Eliyahu, who has previously been quoted as implying that soldiers should refuse orders to evacuate fellow Jews, advised troops to obey their commands.
The Supreme Court ruling comes as opinion polls show that the public's support for the plan - initially at more than 70% - is dropping.
Recent polls show support for the plan is hovering around 50% and opposition has risen slightly.
Gaza mayor Avner Shimoni latched on to the opinion polls, saying the Supreme Court's ruling will become irrelevant if the public does not support the evacuation.
"Our people are strengthening from day to day and are really very encouraged by what is happening," Shimoni told Israel's Army Radio.
"The polls show that the public is opposed... In the end this is what will pressure our parliament to decide against this."