Eitan Biran has been the focus of a legal battle between his paternal relatives in Italy and his maternal family in Israel since surviving the May 23 cable car crash, which killed 14 people, including his parents and younger brother.
Eitan and his parents were living in Italy at the time of the accident. After his release from a Turin hospital following weeks of treatment, Italian juvenile court officials ruled the child would live with a paternal aunt, Aya Biran, near Pavia, in northern Italy.
His maternal grandfather, Shmulik Peleg, then spirited him away without the knowledge of the relatives in Italy, taking him across the border into Switzerland by car and then flying him to Israel on a private jet. Peleg has said he acted in the child's best interest.
The Peleg family said it would continue to fight "in every legal way" to return the child to Israel. It was not immediately clear what legal options were available following the Supreme Court ruling.
Attorneys for Aya Biran welcomed the ruling, calling it "the end of an unfortunate episode" and expressing sorrow that the boy had been stripped away from his normal life after the tragedy and forced to endure months of upheaval.
Earlier this month, an Italian judge issued an arrest warrant for Gabriel Abutbul Alon, who is accused of having driven the car on Sept. 11 that spirited Eitan from his home near Pavia to Switzerland. Peleg was also named in the arrest warrant.