Activists filed a class action lawsuit in 2022 with a district court claiming the state violates their rights as laid out in the European Convention on Human Rights by not doing enough to limit climate change, nor to mitigate its effects.
The group of 300 plaintiffs, who call themselves the Aurora group, wanted the district court to order Sweden to do more to limit global warming to 1.5C.
"A court cannot decide that the Riksdag or the government must take any specific action. The political bodies decide independently on which specific climate measures Sweden should take," the Supreme Court said in a statement on Wednesday.
But the court did not rule out that a climate lawsuit formulated differently could be heard in Sweden, as the European Court of Human Rights has said groups meeting certain requirements may have the right to sue over climate change.
"The Supreme Court states in its decision that such a case could only concern the question of whether individuals' rights under the convention have been violated, not what specific measures the state is obliged to take," it said in a statement.
The Aurora group said it would review its legal options.
"We will continue to desperately try to prevent planetary collapses and get Sweden to do their legal duty to respect human rights and stop making the planetary crisis worse," Aurora's legal and scientific co-ordinator Ida Edling told Reuters.
Last year, the European Court of Human Rights (ECHR) ruled that the Swiss government had violated the rights of an association of senior women by failing to do enough to combat climate change.
But it rejected two other cases, including one filed by six young Portuguese individuals brought against 32 European countries where the plaintiffs said states were failing to avert catastrophic climate change.
The court said those individuals first needed to seek a ruling in Portugal.
