The New Zealand Animal Law Association (ALA) and animal rights lobby group SAFE took the Agriculture Minister and National Animal Welfare Advisory Committee to court over their code of welfare for rodeos, seeking a judicial review.
The groups hope to bring an end to a sport they said subjects animals to "unnecessary and unlawful" stress.
While the court declined to make a ruling on the legality of rodeo, it did decline the judicial review sought by ALA and SAFE.
The court said the proper place to challenge the practice of rodeo would be during a consultation process run by the National Animal Welfare Advisory Committee.
About 35 rodeos are held each year in New Zealand, with animals integral to events such as bull riding, calf roping and steer wrestling.
Lawyers for the ALA had argued proper process was not followed in adopting a 2018 rodeo-specific animal welfare code, and that rodeo under that code was in violation of the Animal Welfare Act.
Key principles of the act are that no animals should have unnecessary distress and pain inflicted on them.
A Code of Welfare (Rodeos) was set in 2014 by the Ministry for Primary Industry, then updated in 2018.
SAFE and NZALA said the code normalises mistreatment of animals at these events, which is therefore violating the Animal Welfare Act.
After the High Court ruling, both organisations said they would not give up.
SAFE called on the National Animal Welfare Advisory Committee to review the code of welfare for rodeo urgently, and said they would monitor the creation of new code carefully.