The two developers, through their joint venture called The Scottish Retail Property Limited Partnership (SRPLP), argued that the inclusion of retail in the plans to regenerate the former British steelworks at Ravenscraig contravened national planning policy.
SRPLP spokesman David Smith said: 'We are disappointed by today's decision...While we have always supported the regeneration of the Ravenscraig site, this was on condition that it was of a scale which did not adversely affect existing retail developments in the surrounding area.'
SRPLP brought the case to court after the Scottish Executive granted planning permission for the out-of-town site, which included a large retail element, to house builder Wilson Bowden and steel company Corus.
The Lords had been asked by SRPLP to rule on two questions: firstly, whether Scottish ministers were entitled to overrule national planning policy; and secondly, whether they were entitled to grant town centre status to a town that has not yet been built.
Smith said that SRPLP plan to 'consider our legal position'.