The firm says its new range will not directly support the two groups
Six people have been convicted in Denmark of raising funds for extremist groups by selling T-shirts with their logos on. A seventh was acquitted.
Two of the defendants were sentenced to six months behind bars, while others received suspended jail terms.
The Fighters and Lovers firm made and sold garments bearing the logos of the Palestinian PFLP and Colombia's Farc.
Part of the proceeds were to be sent to the groups, which the EU says are terrorist organisations.
Danish law says anyone involved in the direct or indirect financing of terrorist organisations is punishable by up to 10 years in prison.
In December a lower court acquitted all seven defendants, after finding that the two organisations were "not really terrorist" groups.
But an appeal court on Thursday overruled that decision, declaring Farc and the PFLP "terrorist organisations that have committed acts aimed at destabilising a state or a government and have attacked civilian targets".
Farc has been involved in a 40-year conflict with Colombian state forces and right-wing paramilitary groups, in which tens of thousands of civilians have died.
It has increasingly become involved in illegal drug trafficking to raise funds, and holds hundreds of kidnapped Colombians and foreigners in the jungle.
The PFLP, which combines Arab nationalism with Marxist-Leninist ideology, has carried out suicide attacks inside Israel and against Jewish settlements.
It sees the destruction of Israel as integral to its struggle to remove Western influence from the Middle East.
Fighters and Lovers said it would donate five euros (£4) to the two groups for each T-shirt it sold.
It said the money would finance Farc radio stations in Colombia and a graphics studio in the Palestinian territories.
But the appeals court ordered the confiscation of the approximately 25,000 kroner (£2,600) the company had made on the sales.
Michael Schoelardt, the company's managing director, who got six months in prison, said: "We must stand firm in our fight for peace and justice in the world."
Lawyers said they would try to take the case to the Supreme Court.
Schoelardt was one of five employees of the firm convicted after admitting producing, selling and distributing the T-shirts.
A sixth defendant was convicted for allowing the company to use his server for its website.
A seventh defendant, a hot dog seller who had put up the company's posters, was acquitted.
The company still makes T-shirts with the logos on, marketed on its website with the heading "Freedom fighters are not terrorists".
It says proceeds from the new range will not go to the militant groups themselves, but to legal aid groups supporting "victims of the Israeli occupation and Colombian government".