Eastleigh Local Area Council voted 5-3 to throw out plans for an extra 164 metres of runway after a two-day meeting.
The extension is seen as essential by the airport as it looks to increase traffic after Covid-19 by offering flights to European holiday destinations.
Campaigners cited increased noise and pollution as reasons to reject the plan.
Other local bodies and Bournemouth Airport were among the objectors and naturalist Chris Packham spoke against the extension when it was announced in 2019.
‘Naturally, we are very disappointed with the lack of support from the Eastleigh Local Area Committee,’ said director Rhiannon Thompson.
‘The committee did not support the recommendations of the planning officer and in doing so it has gone against the majority of Eastleigh residents who expressed their support during the consultation as well as the local business community.
‘However, this is far from over. We now welcome the opportunity to present our plans to the full council on 8 April.
‘We hope they will listen to the will of the people, the local business community and their own planning team and make the right decision for the future of the airport and seize the opportunity to create thousands of jobs.’
Southampton has been the Bailiwick’s lifeline airport during the pandemic and the States of Alderney lobbied for the extension.
Even before Covid-19 struck, the number of flights using Southampton had been reduced drastically by the demise of Flybe.