Mr Trump responded withsaying national security was at risk and there would be a legal challenge.
It was unclear whether he intended to file an appeal to the Supreme Court or keep fighting the case in Seattle.
In its 3-0 unanimous ruling on Thursday, the appeals court said the government had not proved the terror threat justified reviving the ban.
Themeans that people from Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen with visas can continue to enter the US, and refugees from around the world, who were also subject to a temporary ban, are no longer blocked either.
However, the ruling does not affect one part of Mr Trump’s controversial: a cap of 50,000 refugees to be admitted in the current fiscal year, down from the ceiling of 110,000 established under his predecessor, Barack Obama.