The district court in Chiba near Tokyo said the government "was able to foresee" but "may not have been able to avoid the accident" caused by the tsunami that smashed into the Fukushima Daiichi power plant.
Triggered by a 9.0-magnitude earthquake, the water overwhelmed reactor cooling systems, sending three into meltdown at the plant in eastern Japan.
Radiation was spewed over a wide area, leaving vast swathes of land uninhabitable in Japan's worst postwar disaster and the world's most serious nuclear accident since Chernobyl in 1986.
Chiba court judge Masaru Sakamoto turned down the demand of 42 plaintiffs for the government to pay compensation.
However, the court ordered operator Tokyo Electric Power Co (TEPCO) to pay a total of 376 million yen ($3.3 million), much less than the the 2.8 billion yen plaintiffs had sought.
Around 12,000 people who fled over radiation fears have filed various group lawsuits against the government and TEPCO.
Cases have revolved around whether the government and TEPCO, both responsible for disaster prevention measures, could have foreseen the scale of the tsunami.
Dozens of class-action lawsuits have been filed seeking compensation from the government over the disaster, and the latest ruling is only the second verdict.
In a verdict made in March by the Maebashi District Court, north of Tokyo, the judge ordered both the government and the plant operator to pay compensation, though the figure was far below plaintiffs' demands.
In June, three former TEPCO executives went on trial, the only people ever to face a criminal court in connection with the disaster.
Prosecutors had twice refused to press charges against the men, citing insufficient evidence and little chance of conviction.
But a judicial review panel composed of ordinary citizens ruled in 2015 that the trio should be put on trial, which compelled prosecutors to press on with the case under Japanese law.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)