The Court of Appeal told Dr Christine Nunn there was nothing it could do to remove a planning law barrier that prevented her and fellow objectors from putting their case at a local inquiry.
The appeal judges said the only remedy open to Dr Nunn and her neighbours was to claim damages against Leeds City Council, whose apparent incompetence led to the 40ft mast being built unchallenged in the first place.
Lord Justice Wall said she "may well feel this is a poor reward for her altruism" in representing the interests of her local community and her family.
Yesterday Dr Nunn said: "I am disappointed. I think it's a pity."
But she added: "I am determined to carry on fighting if we possibly can, that would be down to taking legal advice and also the finances."
Dr Nunn, her husband Geoff and their three children, who all suffer from migraines, moved to the Old Vicarage at Bardsey, Leeds, because they believed it was in an area where there were no aggravating factors.
The GP had discovered that using a mobile phone could trigger her migraines.
But a mast was built by phone company T-Mobile only 130 yards from her new home in Bardsey.
Dr Nunn, 45, and her neighbours tried to protest at a planning inquiry that, apart from the health implications, the mast would reduce property values and adversely affect local amenities.
However, the inquiry inspector said he had no power to hear their case because Leeds City Council had failed to lodge a notice of objection with T-Mobile within a statutory 56-day deadline.
The council lodged its notice one day late, believing it was still within the time limit.
As a result the inspector ruled that T-Mobile was deemed to have permission under planning laws, and quashed an enforcement notice issued by the council requiring removal of the mast.
That decision was upheld in the High Court last year by Mr Justice Collins, who said he had "enormous sympathy" for Dr Nunn, but her case was "unarguable".
Yesterday, she lost again and was refused permission to appeal to the House of Lords, although she can still apply direct to the Law Lords for permission.
Dr Nunn said she believed the problem lay with the Government and the law gave mobile phone companies wishing to put up masts more powers than members of the public.
Dr Nunn and her husband reckon they have spent around £35,000 on their legal battle since the saga began in 2002.
A spokesman for Leeds City Council said: "We have just received a copy of the judgment and are considering the implications."
After the ruling a spokesman for T-Mobile said: "T-Mobile welcomes the fact that the Court of Appeal agrees with the Government that the permitted development regime for mobile phone base stations is compliant with the Human Rights Act.
"This case has not changed the mobile telecoms planning regime. The same controls are in place.
Mobile phone operators have been given no new rights to build mobile phone base stations."
joanne.ginley@ypn.co.uk