The 2022 champions were expelled from the Australian top flight last year amid financial problems and following a player registration ban from global governing body FIFA.
The club's ownership group staved off liquidation after securing funds to pay a tax debt by January but are being pursued by other creditors over unpaid debts, Australian media reported last month.
Football Australia said on Tuesday its "First Instance Board" had approved licenses for the 12 existing A-League clubs for the 2026/27 season but not Western United.
"The FIB confirmed all current A-League teams, with the exception of Western United FC, have satisfied the mandatory criteria set out in the Regulations for A-Leagues club licensing purposes," FA said in a statement.
Western United will have until Friday to appeal the decision.
The club said they were reviewing the determination and appeal rights but stopped short of saying whether they would seek to overturn it.
"We can assure the community that work continues behind the scenes to stabilise the club and secure a long-term sustainable future for football in Melbourne's west," they said in a statement.