The Physicians Committee for Responsible Medicine (PCRM) group, which is thought to have links with animal rights protestors, will appeal against the ruling on behalf ten residents in Washington DC.
The original lawsuit filed by PCRM called for lactose warning labels on all milk products to protect consumers who were unaware they might be lactose intolerant.
The case has fired up more debate about lactose intolerance in the US.
Judge Henry Kennedy Jr, in the Columbia District Court, threw out PCRM's request for warning labels last week, to the delight of America's dairy industry.
"The ruling is a sound defeat for PCRM, a group whose views on nutrition have been repeatedly denounced by reputable science and health organizations," said the International Dairy Foods Association (IDFA) vice-president of communications, Susan Ruland.
Around 5 per cent of the UK, Irish, North European and American population is though to be lactose intolerant.
The condition is a basic lack of lactase (the enzyme which breaks down the milk sugar lactose) in the body, meaning sufferers can experience bloating, abdominal pains and diarrhoea as a result of excessive lactose consumption.
Lactose intolerance has become a thorny issue in the dairy health debate that has been played out across the media in America and Europe over the last couple of years.
In this context, a requirement to put lactose warning labels on all milk would be viewed as a serious defeat by the dairy industry. The EU already requires all foods containing milk products to flag this up on the label, as part of its new allergen labelling rules.
Both the IDFA and dairy associations in Europe have repeatedly warned about the dangers of self-diagnosis for consumers. The UK Dairy Council said last year that 45 per cent of the UK population claimed to be lactose intolerant, when only two per cent had been diagnosed.
Diagnosis of intolerance, unlike an allergy, is extremely difficult due to the generic symptoms often involved.
Heightened publicity about lactose intolerance, however, has affected dairy markets. Research group Euromonitor reported last year that lactose-free dairy products was showing promising growth in the global dairy sector.
The IDFA and dairy associations in Europe have repeatedly said that lactose intolerance does not have to mean giving up dairy altogether, following claims by some medical professionals that lactose intolerant consumers can wean themselves back on to dairy.
The industry has also sought to highlight the benefits of dairy products, such as their high calcium content for bones.