Anwar, 62, was sacked from his posts as deputy premier and finance minister by then-prime minister Mahathir Mohamad in September 1998.

He was subsequently charged and jailed for corruption and sodomy.

Anwar argued that his sacking was unconstitutional, but his case has been rejected twice by the High Court and Court of Appeal.

On Monday, the Federal Court, the country's highest, upheld the earlier decisions.

Anwar, who was released in 2004 after his sexual misconduct charge was overturned, now leads a three-party opposition alliance.

The opposition coalition won major gains in the March 2008 general elections, wresting five out of the country's 13 states from the powerful National Front coalition. The alliance's advances also denied the government its two-thirds parliamentary majority.

Anwar is currently facing trial on charges that he sodomized a former male aide in 2008. If found guilty, he could face up to 20 years in prison.

He has denied the accusations, and claims he is being framed as part of a political conspiracy to weaken the opposition.