British Airways, which is locked in a bitter battle with cabin crew over cost-cutting, did not act unlawfully by reducing their numbers on some flights, a court ruled on Wednesday.
Trade union Unite, representing cabin crew who have staged 22 days of strikes this year, had argued that the airline had unilaterally reduced crew numbers below agreed levels.
It wanted to secure injunctions forcing BA to remedy the situation.
But judges ruled in the airline's favour in a move welcomed by BA.
"We are pleased with today's Court of Appeal judgment, confirming that the modest changes we made to onboard crew numbers on flights from Heathrow 12 months ago were reasonable, did not breach crew contracts and can remain in place," the firm said in a statement.
"The changes have made a substantial contribution toward easing the company's financial position, and our crew have accepted these working arrangements without difficulty."
BA says it has reduced cabin crew numbers on the flights by one, in a move which keeps it well over the legal minimum. On a Boeing 747, for example, the numbers have fallen from 15 to 14.
The airline, which is merging with Iberia of Spain, last month announced a net profit of 107 million pounds (122 million euros, 170 million dollars) for the six months to September, its first interim profit for two years.
The airline industry was hit hard by the global economic downturn but analysts say there are now signs that demand is picking up.