Campaigners had said that the attempt by Hayley Powers to halt construction of a new academy in Islington, north London, could have had serious implications for government proposals to open a wave of the privately-sponsored independent schools across England.
Mrs Powers had argued that many local children would be adversely affected by the decision to replace the successful St Mary Magdalene primary school with an academy for children aged three to 19, sponsored by the Church of England.
Her lawyers also argued in London's High Court last week that the Office of the Schools Adjudicator had acted "unlawfully" in approving the plans because it did not have access to the academy's final "funding agreement" - which outlines rules on admissions, exclusion and religious education - when it made its decision.
However, Mr Justice Wilkie rejected their arguments, saying that the academy would "improve the standards, quality, range and diversity of educational provision in the area".
In a judgement released this week, he said that, when the adjudicator made its decision, it had a "very clear statement" from the Church of England that the draft funding agreement "closely followed" a model document produced by the Department for Education and Skills.
The judge said that a "rigorous procedure" would have to be followed if the sponsors intended to depart from the model.
He also rejected claims that the academy would reduce rights and protections of children at other state schools. "I reject the contention of Mrs Powers that the maintained sector constitutes a gold standard and that any falling away from that standard requires justification," he said.
The academy "recognises and encourages diversity of provision", said the judge, and the adjudicator did not have to "justify" each and every "difference" between the new academy and its local authority-maintained predecessor.
Alan Johnson, Education Secretary, said: "The judgement confirms that the Government is right to proceed with academies to give children the chance of a good education rather than accept a status quo which let down too many."
In a statement, Leigh Day Co, Mrs Powers's solicitors, said: "Obviously, Hayley Powers is very disappointed by the result. However, she is pleased the judge has recognised that the adjudicator needed to consider representations from parents and pupils about the rights and protections that the likely funding agreement would give them at the academy."