Yingluck, one of four members of the billionaire Shinawatra family to have served as prime minister, has been living overseas to avoid jail for failing to prevent corruption in the rice scheme, which paid farmers up to 50 per cent above market prices and caused massive losses to the state.
The program, a flagship policy of her populist Pheu Thai party, cost the state billions of dollars and led to millions of tons of rice going unsold.
Thailand is the world's second-largest rice exporter.
Thursday's ruling was on Yingluck's appeal against a previous order to pay 35 billion baht in damages to the finance ministry.
"The accused performed duties with gross negligence that caused damage to the state and therefore must pay compensation," the Supreme Administrative Court said, adding the previous order exceeded the legal threshold of her responsibility and was unlawful.
Yingluck, 57, came to power in 2011 after a landslide election victory and resigned just days before her government was ousted in a coup in 2014.
She is the aunt of current Prime Minister Paetongtarn Shinawatra and younger sister of former premier and political heavyweight Thaksin Shinawatra.
Thursday's verdict comes less than two years after her family's Pheu Thai party returned to power after a decade in the political wilderness, coinciding with influential brother Thaksin coming home after 15 years in self-exile to avoid jail.
The Shinawatras have consistently denied wrongdoing and have long maintained they have been victims of political vendettas by powerful figures in the conservative establishment and royalist military.
Yingluck on Thursday said the order to pay 10 billion baht was excessive.
"Even if I repaid it my entire life, it would never be enough," she said on social media.
"I will continue to demand and fight for justice."
