The High Court has ruled that Gary McKinnon, who admitted hacking into systems at the Pentagon and Nasa, cannot appeal against his extradition to be tried in the US.
McKinnon's lawyer attempted to link the case to an appeal against extradition filed by Ian Norris, a British businessman facing US charges for alleged involvement in a cartel.
McKinnon may take his case to the European Court of Human Rights, according to his lawyer, Karen Todner. That court, however, refused in August 2008 to stop his extradition.
"We are not giving up," Todner said in a statement. The government has given McKinnon's legal team 14 days to consider its options.
Today’s ruling is the latest in the long-running legal battle. The order to extradite McKinnon was approved by the government in July 2006, but his legal team continued to challenge the order, holding up his transfer.
The High Court ruled on 31 July that McKinnon's extradition to the US should proceed despite his diagnosis with Asperger Syndrome, a neurological disorder characterised by obsessive behaviour and deficiencies in social interaction.
McKinnon had also asked the court to review a refusal by the Director of Public Prosecutions (DPP) for England and Wales to prosecute him in the UK.
British prosecutors, however, maintain that the US wants jurisdiction and that most evidence and witnesses are in the US.
McKinnon was indicted by the US District Court for the Eastern District of Virginia in 2002 for hacking into 97 military and NASA computers between February 2001 and March 2002. He could face up to 60 years in prison.
The US military alleges the hacking resulted in the shutdown of critical networks. McKinnon allegedly left messages such as "US foreign policy is akin to government-sponsored terrorism these days.... I am Solo. I will continue to disrupt at the highest levels".
The US government said McKinnon's actions caused $700,000 (£437,000) in damages.
The reclusive McKinnon, who rarely makes public appearances, has become an unlikely cause célèbre, raising issues outside the sphere of computer-related crime.
Several Members of Parliament have thrown their support behind McKinnon, in addition to newspaper the Daily Mail and celebrities such as Pink Floyd guitarist David Gilmour or Sting, lead singer and bassist for The Police.
McKinnon has freely admitted to breaking into the computers, saying he was looking for evidence of UFOs. The computers were accessed using a program called "RemotelyAnywhere", an access tool used by administrators to fix computers remotely.
McKinnon has said the military computers were poorly secured, often using default passwords that were easy to guess.
His hacking career ended after he mistakenly took over a computer during US working hours. Someone noticed a computer's cursor moving on its own, and the Internet connection was shut down. Shortly thereafter, UK police arrested him at his north London home.