The New York State Department of Corrections and Community Supervision said Thursday a parole board determined paroling Chapman would be "incompatible with the welfare and safety of society and would deprecate the serious nature of the crime."
The board also said if released, Chapman's safety could be endangered because of the possibility of revenge or anger by a Lennon fan.
Chapman, 63, was sentenced to 20 years to life and is serving time at the Wende Correctional Facility in Alden, N.Y., near Buffalo.
Chapman shot Lennon in December 1980 as he returned to his apartment with partner Yoko Ono. He's said he regrets the act and that he shot the former Beatles icon after he grew disenfranchised with his controversial remarks and lavish lifestyle.
Fans of Lennon called for the board to reject Chapman's release during a rally at Strawberry Fields, Lennon's memorial in New York City's Central Park. Ono has sternly opposed Chapman's release, saying she'd fear for her life and those of her two sons if he left prison.
Chapman was first eligible for parole in 2000 but has been denied in each of his 10 applications for release. His next parole hearing will come in 2020.