Dotcom's lawyer, Ira Rothken, said his team was disappointed with the appeal court's decision, and revealed that he will continue to fight the case by bringing it to the New Zealand Supreme Court.
The decision comes more than six years after USA authorities shut down Dotcom's file-sharing website Megaupload and filed charges of conspiracy, racketeering and money laundering against the men.
Dotcom, a German national who has permanent residency in New Zealand, had asked the Court of Appeal to overturn two previous rulings that the Internet mogul and his three co-accused be sent to America to face charges.
New Zealand's Court of Appeal upheld the charges against Mr Dotcom and his Megaupload cofounders Mattias Ortmann, Bram van der Kolk and Finn Batato.
"It is held to decide whether there is sufficient evidence to commit a person for trial on a qualifying offense", the New Zealand Court of Appeals said in its ruling.
They deny the accusations and have been fighting hard against extradition, arguing that Megaupload was simply a file-sharing website and that they shouldn't be blamed for what others were uploading to it.
"The precedent set is concerning and has ramifications in New Zealand outside my case", Dotcom added. The court pointed to several court decisions and government reports that had drawn no distinction between physical and digital copies in interpreting this provision of the law.
The court found all of the pathways are available to the U.S., and it "has tendered sufficient evidence to support their case on those pathways", the court said in a statement accompanying the decision.
"We are satisfied New Zealand law permits extradition for copyright infringement in the circumstances of this case", said the court's decision, by Justices Kós, French and Miller.
The accused could face decades in prison, if convicted in the U.S.
"We direct that the District Court should now proceed without further delay to complete its duties under section 26 of the Extradition Act in accordance with the determination", it said.
In a statement today he says he's confident the Supreme Court will hear the appeal because of the significant legal issues at stake.
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