Nadia Eweida, 58, from Twickenham, south west London, had wanted three judges to overturn a decision by the Employment Appeal Tribunal that she was not a victim of indirect religion or belief discrimination.
Lord Justice Sedley, giving the ruling of the court, said her case of indirect discrimination was defeated by BA's case on justification.
He said: "This case has perhaps illustrated some of the problems which can arise when an individual asserts that a provision, criterion or practice adopted by an employer conflicts with beliefs which they hold but which may not only not be shared but may be opposed by others in the workforce.
"It is not unthinkable that a blanket ban may sometimes be the only fair solution."
Lord Justice Sedley said Miss Eweida is a devout practising Christian who worked part-time as a member of check-in staff since 1999.
She made complaints about incidents between 2003 and 2006 which she claimed showed anti-Christian bias on the part of BA.
The airline scrapped a high-necked uniform and introduced a new one in 2004 which could be open neck and prohibited the wearing of any visible item of adornment around the neck.
On at least three occasions she came to work with the cross visible under her uniform but concealed it when asked to do so.
But when she refused to cover up the cross, she was sent home and remained there unpaid from September 2006 to the following February.
Lord Justice Sedley said: "A storm of media attention, much of it hostile to the respondent, led the respondent to reconsider its uniform policy and to introduce an amended policy in 2007 which permitted staff to display a faith or charity symbol with the uniform."
Miss Eweida, who is backed by human rights group Liberty, returned to work after the policy change but claimed she was due around £120,000 in damages and lost wages.
Her QC, Karon Monaghan, told Lord Justice Sedley, Lord Justice Carnwath and Lady Justice Smith, at the appeal hearing in London last month, that the issue was whether the Employment Appeal Tribunal (EAT) correctly addressed the question of "particular disadvantage".
"We say that the EAT fell into error when it concluded that it was necessary to establish a group disadvantage among Christians generally for the purposes of the indirect discrimination provisions. The appellant's case is that it was not necessary."
She said it was sufficient for Miss Eweida to show - as she did - that she was placed under a particular disadvantage arising from her religious beliefs.
Lord Justice Sedley said indirect discrimination was not necessarily wrongful.
"The defendant employer may show that, in spite of its negative effect, the provision, criterion or practice, despite its unequal impact, constitutes a proportionate means of achieving a legitimate aim."
He said Miss Eweida's objection was purely personal - "neither arising from any doctrine of her faith nor interfering with her observance of it and never raised by any other employee".
Liberty said in a statement that the appeal court had upheld the EAT's "startling" judgment of November 2008, which found that banning Ms Eweida from wearing a cross was not discriminatory because Christians "generally" do not consider wearing a cross as a requirement of their religion.
Corinna Ferguson, Liberty's legal officer who represents Ms Ewedia, said: "This is a disappointing judgment that will do little to build public confidence in equality laws protecting everyone.
"But this is just the sort of case that a Supreme Court is for and we have every hope that the highest court in the land will put Britain's long tradition of religious tolerance into modern legal practice."
Vincent Cable, Ms Eweida's MP and the Liberal Democrat Treasury spokesman, said: "We fight on and we fight on to the Supreme Court over this important issue of principle and freedom of expression."
Lord Carey, former archbishop of Canterbury and supporter of Ms Eweida, said: "The news that Nadia Eweida's appeal has failed is a sad blow both to her personally, and the cause of religious liberties and freedoms.
"Her courage and endurance since 2006 when she was sent home from work for wearing a cross have been an inspiration to so many of us.
"Sadly, the failure of this appeal is likely to lead to further cases of religious discrimination.
"I believe it is not an exaggeration to say that people of faith are facing particular hardship in a period where different freedoms and rights are being tested against each other."
Carla Revere, vice president of the National Secular Society, said: "At the moment, employers are walking on eggshells in many areas which involve religion at work.
"We hope that this judgment will help them feel more confident in setting their employment policies in relation to dress codes and other religious requirements."
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