In December, European football's governing body suspended the Spain international for two matches – one for collecting a second booking of the Champions League group stages and a second after ruling Carvajal collected that caution against APOEL deliberately to serve his suspension in a dead rubber against Borussia Dortmund.
A statement issued by UEFA read: "The UEFA Appeals Body met on 1 February following an appeal lodged by Real Madrid CF against the decision announced by the UEFA Control, Ethics and Disciplinary Body (CEDB) on December 7, which ordered
Real Madrid player Dani Carvajal to be suspended for two UEFA competition matches for which he would be otherwise eligible.
"The appeal lodged by Real Madrid has been dismissed and the UEFA CEDB's decision of December 7 is confirmed.
"Given that Carvajal did not participate in the match between Real Madrid and Borussia Dortmund played on December 6 2017, the player still has to serve one UEFA competition match for which he would be otherwise eligible."
The ruling represents a significant selectorial blow for Zinedine Zidane, who is chasing his third consecutive European title as Madrid boss but with the added pressure of a disappointing domestic campaign leaving the UEFA Champions League as his only realistic remaining prospect of major honours this season.
Madrid hosts PSG at the Santiago Bernabeu on 15 February (AEDT) and travels to the Parc des Princes for the return on 7 March.