The Union of Rightist Forces and a Siberian geologist active in pro-democracy circles, Vladimir Grishkevich, had appealed to the court to rule on the constitutionality of the system.
The new procedure abolished direct elections for governors. Instead, it gave the president the right to propose candidates, who are then to be confirmed or rejected by regional legislature.
The Constitutional Court today ruled that the new system "cannot be seen as violating the principle of separation of powers or the principle of federalism."
The court refused to consider whether the president has the right to dismiss governors and dissolve regional legislatures if they refuse twice to confirm his nominee.