Muhammad Zayed, 32, was convicted by a federal jury on 10 March of conspiring to provide material support and resources to prescribed organisations in the US.
At a sentencing hearing in Brooklyn federal court on Thursday, he was given a 15-year sentence and a $250,000 fine for each of three counts. His sentences are to be served consecutively.
His colleague Shaikh Muhammad al-Moayyad was sentenced in July to 75 years and fined $1.25 million in the same case.
For each of five counts, the shaikh received 15-year sentences, each to be served consecutively.
Before sentencing, Zayed told the court: "I have never supported in any one day or time any terrorist organisation whether it be moral support or financial support.
"I am swearing by God, I do not believe in terrorism. I do not believe in causing trouble or damage to anyone."
However, four days of videotaped meetings between the defendants and FBI undercover agents in a Frankfurt hotel in January 2003 formed the crux of the government's case.
In one meeting they were recorded promising more than $2 million to Hamas, the Palestinian resistance to occupation organisation.
Prosecutors argued that the pair were involved in a long-running effort to funnel cash to the groups.
Defence lawyers countered that in Yemen it was not illegal to support Hamas and that the men were entrapped in a situation manipulated by the US government after 9/11 attacks.
Moore said at sentencing" "These tapes clearly show this defendant was an active participant, he was al-Moayyad's confidant."
But Judge Sterling Johnson said as he handed down the sentence: "Everyone all over the world should condemn terrorists and terrorist organisations."
Defence lawyer Jonathan Marks called the sentence ridiculous and insisted Zayed was "a minimal player who was really a victim of a cunning informant who set him up in a sting operation".
Zayed was "a minimal player who was really a victim of a cunning informant who set him up in a sting operation"
That informant, Muhammad al-Ansi, set himself on fire outside the White House in November in an apparent suicide bid after saying he was mistreated by the FBI.
The shaikh's lawyer had argued that his client only listened to the pitches from the undercover officers, who promised money for the shaikh's legitimate charities and for medical treatment for his severe diabetes if he supported Hamas and al-Qaida.
The Yemeni government and the pair's friends reacted strongly to the sentencing, where both are widely respected as champions of the poor.
Al-Moayyad's charitable societies feed thousands, and he had also built a school and a mosque.
Both men were arrested in Berlin after travelling there to meet someone they were told would make a donation to his charity.
But that turned out to be a ruse by an agent of the FBI. The two were arrested in Germany and handed over to the US. FBI operators said they taped a conversation where al-Moayyad boasted of raising funds for al-Qaida and Hamas.
In an official statement, the Yemeni government said no evidence was found of any financial aid to al-Qaida, and that al-Moayyad's raising funds for the cause of Israeli-occupied Palestinians was not a crime.
"We regret this sentence against a man who has spent his life and his money helping poor families and orphans," the official statement said.
And Hamud al-Tharihi, head of the National Public Committee for Defending al-Moayyad, told Aljazeera.net the punishing people for supporting Hamas was unfair "because 1.5 billion Muslims donate for Hamas and for all Palestinians against Israel".
Zayed's lawyer, Khalid al-Anisi, warned that the verdict would widen the growing divide between the US and Arab and Islamic countries.
"This is an illegal and illogical sentence," al-Anisi said. "It is a message to Muslims that says this will be the end of everyone who supports Palestinians."
On 1 August, Foreign minister Abu-Bakr al-Qirbi said the Yemeni authorities had from the start opposed extradition of al-Moayyad to the US as US law was "not applied evenly around the world".
But anger is turning against Yemeni officials too, as they continue to demonstrate their inability to defend their own citizens abroad, according to lawyer Naji Allaw.
"Arab people are imprisoned by their leaders and Arab leaders are America's prisoners," Allaw said.
And the chair of the Yemeni Women's Union, Ramzia al-Iryani, has urged civil society groups and local and international human-rights organisations to step in to save the pair from a "failed and politicised jury".