The test-case decision means that David and Christine Millington, who run Wroxeter Roman Vineyard near Shrewsbury in Shropshire, need special planning permission to sell the wine they produce to visitors.
They had argued that the sale of wine from their six-acre vineyard at Glebe Farm, which is also the site of Roman ruins, was ancillary to the agricultural activity of wine-making and not a change of use.
But the judge was "wholly unimpressed" with their argument and ruled that, while the growing of grapes was agriculture, wine production was not. He rejected as "immaterial" the argument that European Union regulations defined wine as an "agricultural product".
Mr Millington had challenged a ruling by John Prescott, the Secretary of State of the Environment, Transport and the Regions, that wine-making was an industrial process.
Bitterly disappointed by the High Court decision, Mr Millington said: "European wine-makers will be downing another glass of their industrial wine and laughing."
Mr Prescott had upheld an enforcement notice, served by Shrewsbury and Atcham Borough Council on the Millingtons to stop selling wine andrefreshments.
Local residents had fought a long campaign against the commercial activity at thevineyard, saying their peace had been shattered by the amount of traffic it brought.
In July last year, protesters with pitchforks and video cameras staged a rural rebellion and held up a visiting coach carrying a women's group from Birmingham.
The Millingtons challenged both the enforcement notice and Shrewsbury council's refusal to grant a "certificate of lawful use or development" for their wine-selling business.
Even though they lost their wine battle yesterday, the judge said the orders against them should be amended by the Secretary of State to make it clear they were still entitled to go on selling eggs and lavender to visitors.Reuse content