Developer CEG Land Promotions II Limited were refused permission for the scheme by a planning inspector last October.
The company took the case to the High Court, claiming the inspector misinterpreted and misapplied local and national planning policies.
But judge Mr Justice Ouseley yesterday dashed CEG's hopes when he ruled there was no legal flaw in the inspector's ruling.
The judge said Aylesbury Vale District Council did not have in place a five-year housing land supply.
And, under the National Planning Policy Framework (NPPF), that meant a "tilted balance" applied in favour of CEG's proposals.
However, the site is in the Chilterns National Character Area and forms part of the setting of the Chilterns Area of Outstanding Natural Beauty.
The inspector found that the project would cause "moderate to substantial harm" to landscape character and the rural setting of Wendover.
Developing the site would also lead to the "irrevocable loss of part of a valued landscape", she said.
CEG's lawyers argued the inspector had failed to identify any features of the development site itself that could make it "a valued landscape".
The NPPF and the local development plan both contain landscape protection policies and the inspector had made the mistake of "double counting" any harm that the project might cause, it was claimed.
But, dismissing the challenge, Mr Justice Ouseley said there was a "danger of over-analysing" the inspector's decision letter.
On a fair reading, she had properly "balanced harm to the landscape against the absence of a five year housing land supply."
And, after applying the tilted balance in favour of the development, she had been entitled to find that the "adverse impacts of the development would significantly and demonstrably outweigh the benefits".
CEG's judicial review challenge to the inspector's decision was dismissed.