The military submitted a new plan last month after Cabinet approval, but ACRI charged it does not comply with the ruling, because the barrier would still surround two villages.
ACRI objected to the army's solution to the problem -- voluntarily moving villagers to the West Bank side.
The military's response to the court included a paragraph that offers "an arrangement for living outside the area of the barrier."
According to a statement, the civil rights group told the court that this would amount to "immoral and illegal transfer of protected residents from their land."
Israel has said it needs the barrier to keep out Palestinian suicide bombers and other attackers.
Critics charge it is a land grab meant to incorporate Jewish settlements, like Alfei Menashe, into Israel. About 5,000 Israelis live in Alfei Menashe.