Colombia's Council of State approved the dismissal of Gustavo Petro as mayor of Bogota, the most important elected position in the country after the presidency.
The decision on Tuesday came fourth months after the former rebel turned leftist stalwart lost his job, sparking legal appeals and street protests by his supporters in the city of seven million.
Maria Claudia Rojas, president of the Council of State, told a news conference it had rejected all appeals and therefore "the decision to dismiss (Petro) should be executed".
It is now up to President Juan Manuel Santos to formally declare Petro's dismissal.
Petro, who is accused of violating constitutional principles by ending the awarding of trash collection concessions to private companies, tweeted: "Although I know there is sadness in all democratic hearts of Colombia, the struggle for peace and democracy continues."
Elected to a four-year term in 2011 to oversee the Colombian capital, Petro was sacked and banned in December from holding public office for 15 years.
Petro has alleged a conspiracy against the left and the current peace talks between the government and FARC rebels.