Tim Friend, Al Jazeera's correspondent in London reported that the lawyers, who emerged after an hour of legal argument, said they were extremely disappointed at the ruling, and would contest it.
Barak is currently in Brighton, in Britain's southeast, attending a conference for the country's ruling Labour party.
Earlier, Betty Hunter, the secretary-general of the Palestine Solidarity Campaign, said Barak's presence at the Labour party conference in Brighton was a "disgrace".
"As a high contracting party to the Geneva Convention, the British government should be arresting Barak for war crimes, not treating him to dinner."
Barak is expected to meet Gordon Brown, the British prime minister, and David Miliband, the foreign secretary, on Wednesday.
Miliband said the meetings would go ahead regardless of the threatened court action.
"He is the democratically elected defence minister of Israel and I will be pleased to meet him," Miliband said.
More than 1,400 Palestinians, at least one-third of them women and children, were killed in Israel's December-January offensive in the Gaza Strip.
Israel said the air, naval and ground assault on the territory was aimed at halting rocket attacks by Palestinian fighters.
In 2005, human rights groups criticised the British authorities for failing to arrest Doron Almog, an Israeli army general for whom an arrest warrant for alleged war crimes had been issued, when his aircraft landed in London.
Almog stayed on the aeroplane at Heathrow airport after apparently being informed that he could face arrest. He was allowed to return to Israel.