Mehserle, 30, has already served his sentence for the fatal shooting of Oscar Grant, 22, of Hayward, at BART's Fruitvale station in Oakland early on New Year's Day in 2009.
After being convicted in 2010 in a trial that was moved to Los Angeles, Mehserle was sentenced to two years in prison. He was released last year after receiving credits that reduced his time in custody to about a year.
Mehserle appealed his conviction to the Court of Appeal in a bid to clear his name of a felony record, his lawyers have said.
In today's decision, a three-judge panel of the appeals court rejected his claim that there was insufficient evidence to support a conviction of involuntary manslaughter.
Mehserle testified at his trial that he intended to use his Taser stun gun to subdue Grant but accidentally used his service revolver instead.
His lawyers argued in the appeal that while he made a "tragic and horrible" error, he didn't act with the level of criminal recklessness or negligence that legally defines involuntary manslaughter.
But the appeals court said, "We find sufficient evidence that his conduct of mistakenly drawing and firing his handgun instead of his taser constitutes criminal negligence."
The court said Mehserle's handgun was "peculiarly distinguishable from his taser for a number of reasons": the handgun was more than three times heavier; the gun was black and the taser was bright yellow; the gun was on his right side and the taser on his left; and the two devices were kept in their holsters in different ways.
"The jury could have reasonably found defendant's conduct rose to the level of conscious indifference to the consequences of his acts, and was not a mere mistake," Justice James Marchiano wrote for the court.
The panel also turned down Mehserle's challenge to jury instructions given at his trial and his claim that he should have been granted probation instead of a prison sentence.
Mehrserle's attorneys were not immediately available for comment on the decision, which could be appealed further to the California Supreme Court.