One of the 21 excluded parties, the National Conscience party of the human rights lawyer, Chief Gani Fawehinmi, says it will contest the decision by the electoral commission in court.
A BBC correspondent in Nigeria says government opponents see the selection process as having been highly political; all three new parties are linked to powerful business and military figures.
But our Nigeria correspondent Dan Isaacs says parties with genuine opposition credentials also appear to have been squeezed out.
The current government of President Olusegun Obasanjo was elected three years ago, following almost two decades of military rule.
Mr Obasanjo is seeking a second term in office in the presidential poll to be held by April next year.
Parties
In total there will now be six parties competing in local, state and national elections to be held in Nigeria over the coming months.
Barring successful legal challenges, the parties allowed to contest them are
Fraud
Our correspondent says the widespread expectation is that these elections will be marred by fraud and violence.
It is a pessimistic perspective, he says, but supported by the fact that no post-independence civilian administration has ever held successful elections.
But if there is some comfort to be drawn from the present democratic system, it is that even the present three parties do not simply represent distinct ethnic divisions, but rather complex business, political and ethnic alliances.
And also that all through the civil war, military rule, and now the civilian era, Nigeria has remained remarkably stable, despite being home to more than 250 different ethnic groups.
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