Monday's ruling came after The Florida Department of Transportation appealed last year's preliminary order, in which U.S. District Judge K. Michael Moore blocked the measure from taking effect.
In his opinion, Moore said the law interfered with the federal government's power to handle foreign policy issues.
The appeals court in its ruling said it had little difficulty in affirming Moore's decision, and ruled in favor of Odebrecht USA, a Coral Gables firm that had challenged the 2012 law, The Miami Herald said.
The engineering and construction company released a statement Monday after the ruling was announced.
"We will continue to defend our right to serve the State of Florida and its local governments, and remain fully committed to complying with all local, state and federal law," the statement said.
The governor's office said it was reviewing the ruling.
The law could have affected many companies, the Herald reported. A state agency's preliminary analysis listed 238 companies in which the state invests that could have business ties to Cuba.