Joseph Steele and Thomas "TC" Campbell were sentenced to 20 years imprisonment for the murder of six members of the Doyle family in 1984 in what became known as the "ice-cream war" for control of the city's drugs trade.
The pair protest their innocence and campaigners for the so-called "Glasgow two" last month stormed the Edinburgh office of the Scottish Home Affairs minister, Henry McLeish.
Yesterday, there were threats of further demonstrations after Mr Dewar refused permission for a fresh appeal. Agnes Lafferty, Campbell's sister, said her brother was "absolutely gutted" by the decision, "but we will continue to fight on".
Earlier this year, an attempt at appeal failed and the two men were sent back to prison after 14 months of freedom during which Steele had married. But public interest in the case has remained high, fired by the 14-year legal battle and the gangland background to the killings.
Twenty years ago, criminals realised that ice-cream vans could be a perfect front for drug dealing. Andrew Doyle, 18, was a van driver for the Marchetti brothers, in east Glasgow. Pushed out of two areas, the Marchettis tried to hold firm in their home patch of Garthamlock. Mr Doyle was threatened and shot. Then, on 16 April 1984 someone set fire to his tenement home in the night. He and five other members of his family died.
After a trial at the High Court in Glasgow, Campbell and Steele were convicted of the murders and given life sentences. They have refused to apply for parole, believing that would amount to an admission of guilt.
The families had expected the two men home for Christmas but Mr Dewar judged that there were no fresh arguments to justify referring the case to the Court of Appeal.
John Carroll, solicitor for the two men, said the next step was to take the case to the Criminal Cases Review Commission, when it is established next April to investigate alleged miscarriages of justice. He said he was "not surprised, but disappointed", by the decision. He is optimistic the commission will recommend the case goes back to the Court of Appeal.
In a bitter reaction, Jim Steele, Joseph Steele's brother, said campaigners would ensure Mr Dewar's "political demise" and were prepared to resort to civil disobedience: "Donald Dewar has acted in a very cowardly fashion. We are determined to intensify this campaign and direct it towards him."
Co-ordinator of the two men's campaign, Tommy Sheridan of the Scottish Socialist Party, said it was "a very, very sad day for justice in Scotland" and vowed that the high profile demonstrations would continue.
Mr Sheridan led last month's protest when 30 demonstrators occupied Mr McLeish's suite and unfurled banners proclaiming "Innocents imprisoned" from a balcony.Reuse content