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But the Uruguay striker, 27, can now train and play in friendly matches, with new club Barcelona confirming: "He will join the first team's training session, scheduled for Friday.
"The public presentation of Suarez as a new Barcelona player will be held on Monday at the Camp Nou."
It is not known if he will play in Monday's game with Mexico's Club Leon.
A full explanation of the Cas ruling, which still prevents him from playing "organised" matches but now allows him to take part in all "football-related activities", will be published at a later date.
He will still have to serve the remaining eight games of his record nine-match ban in competitive international games, while his competitive Barcelona debut is likely to be at Real Madrid on 26 October in El Clasico.
But Suarez will now be available for Uruguay's friendlies against Japan and South Korea in September and Saudi Arabia the following month.
Suarez's lawyers argued that world governing body Fifa's decision to suspend him from all football-related activity for biting Italy's Giorgio Chiellini during Uruguay's 2014 World Cup group match in Brazil in June was too strong a punishment.
Switzerland-based Cas - an independent body whose rulings are accepted by most sporting organisations - said: "The sanctions imposed on the player by Fifa have been generally confirmed."
But it said preventing Suarez from taking part in any football activity was "excessive", as not allowing him to train would have an impact on the player after the suspension had ended.
World players' union Fifpro said it was "disappointed that the court had decided not to strongly diminish the sanctions" and "remain of the view they are disproportionate in relation to his violation of the Fifa disciplinary code".
It added: "We regret Cas not deciding to reduce the length of Suarez's bans in exchange for an obligation for him to receive treatment."
In addition to being allowed to train and play in friendlies, the former Liverpool player - who moved to Barcelona last month for £75m - can also attend matches and take part in promotional activities.
His legal team said the appeal was a success, arguing Fifa had "misapplied its own rules when considering the case and the sanction it imposed was disproportionate".
Match of the Day presenter Gary Lineker tweeted: "Luis Suarez's appeal against a four-month ban has failed. He is though, sensibly I think, now allowed to train with the team."
"By allowing Suarez to train, Cas appears to have taken into account the club's interests and has emphasised any appropriate sanction for such incidents should be proportionate," said Hannah Clipston, a lawyer specialising in resolving disputes.
"What is proportionate for a repeat offender is different to what is proportionate for a first time offender."
Suarez apologised nearly a week after the incident, despite initially claiming to have lost his balance.
He was previously suspended for biting PSV Eindhoven midfielder Otman Bakkal and Chelsea defender Branislav Ivanovic.
In 2011, he was also given an eight-match suspension and fined £40,000 for racially abusing Manchester United's Patrice Evra.
Luis Suarez's four-month ban for biting an opponent has been upheld by the Court of Arbitration for Sport (Cas).