King's Lynn have lost their appeal against relegation from Blue Square North after an Football Association hearing in Derby.
The panel ruled in favour of the Football Conference's decision to demote the club for failing their ground-grading requirements.
Linnets chairman Ken Bobbins told BBC Radio Norfolk he was devastated.
"It leaves us back where we were at the start of last season, we've worked so hard over the last five years."
He added: "We were getting things sorted, both on and off the pitch in very difficult times, to have that taken away from us in this fashion is devastating."
The club had given written assurance to the Conference that improvements to the council-owned ground at The Walks would be complete by the start of next season.
King's Lynn Borough Council had set aside £250,000 of funds to carry out the work, but Bobbins doubts anything would have swayed the decision.
"I think the decision had already been made, we tried to broach the subject of Hampton and Richmond who only received planning permission for their ground improvements on the 14 May.
"They haven't finance in place, they're asking supporters to make up the deficit of £60,000.
"We have the funds in place thanks to the council, the council have given the undertaking that work will be complete by the start of next season, what more should they want?"
The club have not been able to confirm whether they will play in the Unibond or Southern Premier League next season.
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