Qatar FA loses German lawsuit over 'cancer on football' comment
In February, Zwanziger had already been told in Düsseldorf's district court that his comments, made to a German radio station in June 2015, were covered by freedom of speech.
The 70-year-old has been an outspoken critic of the decision in December 2010 by world football's governing body FIFA to award the 2022 finals to the Gulf state.
The QFA sued Zwanziger for a nominal sum of 100,000 euros ($108,305) after he told public broadcaster Hessischer Rundfunk: "I have always said that Qatar was a cancerous growth on world football. It all started with that decision."
On Tuesday, judge Joachim Matz dismissed the Qataris' lawsuit in his verdict, saying that although Zwanziger's comment was an "insulting evaluation", it was covered by the right to freedom of speech in Germany.
Zwanziger, a trained lawyer who stepped down as German Football Association (DFB) president in 2012, was not in court to hear Matz's decision, but was pleased with the verdict.
"It was a clear criticism that should, however, be possible when it comes to a scandal of such dimensions," he told SID, an AFP subsidiary, of his comments.
"The country is half the size of (the German state) Hessen, has incredible heat, travel around the region is not easy and human rights are trampled on.
"To plan to hold the World Cup there is a joke.
"I am disappointed that all officials, including the DFB, accept the decision as god given," he said.
The QFA now has one month to appeal.
Zwanziger is due back in court on April 27 as former Germany international Guenter Netzer has also brought a lawsuit against him linked to the scandal behind Germany's successful bid to host the 2006 World Cup.
German football has been rocked by allegations, first levelled by magazine Der Spiegel last October, that the DFB used a slush fund in 2000 to buy votes to secure the right to host the 2006 finals.
Netzer has taken legal action over comments Zwanziger made to Spiegel when he claimed Netzer, 71, had told him at a meeting in Zurich in 2012 that the votes of four Asian members of FIFA's executive committee were bought.