Helmut Oberlander, who has been fighting deportation since 1995, can still appeal the decision in federal court, Citizenship and Immigration Canada spokeswoman Nancy Caron told AFP.
The Conservative government of Prime Minister Stephen Harper signed an order on September 27 to revoke the citizenship of Oberlander, 88.
The Canadian government previously stripped Oberlander of his citizenship in 2007, for having lied about his past Nazi activities during World War II when he arrived in Canada in 1954.
At the time, Oberlander made no mention of his membership in the Einsatzkommando, a Nazi mobile killing squad that systematically executed thousands of people in the former Soviet Union after the German invasion.
But in 2009, Canada's appeals court asked the government to review its decision based on Oberlander's claims that he joined the Nazi unit under duress.
"That has now been done and the government is standing by its decision to revoke Mr Oberlander's citizenship," Caron said.
Oberlander, who became a Canadian citizen in 1960, had consistently maintained that he was forced to join the unit because he spoke both Russian and German, and that he only acted as an interpreter.
The Simon Wiesenthal Center, however, has said it considers Oberlander "one of the top 10 most wanted Nazi war crimes suspects worldwide."
If he is deported from Canada, Oberlander could be sent to the Ukraine or elsewhere, Canada's border services agency said.
Canada has deported more than 60 convicted war criminal over the past three years, according to Alexis Pavlich, spokesman for Immigration Minister Jason Kenney.