"The player committed a doping offense, but his fault was not significant," the court said in a statement.
Troicki will be cleared to play again on July 15, having missed four Grand Slam events while suspended.
"I have no idea about what to do now or where to go. I hope somehow I will be able to fight back," he said.
Serbia plays the Czech Republic in the Davis Cup final in Belgrade next week. Troicki appeared in the first two rounds this year. CAS fast-tracked Troicki's case to give him the chance of reselection if his appeal had been successful.
Troicki's Davis Cup teammate and good friend Novak Djokovic lashed out at the World Anti-Doping Agency, saying the decision in Troicki's case proved that the fight against doping is badly organized and he does not trust the system anymore.
"When you are randomly selected to go and provide the test, blood test or urine test, the representatives of WADA ... who are there in the tournament, are supposed to give you the clear indications and explain you the rules and regulations, and what the severe consequences or penalties that you might undertake or you might have if you fail to provide the test," he said. "The representative, she didn't do that in his case."
In 2010, Troicki won the decisive singles rubber in the final against France to give Serbia its first title.
Djokovic also criticized the ATP for not standing behind Troicki.
"So Viktor is there by himself. Tomorrow can be anybody else," Djokovic said. "For me this is just another big reason, another example that there are some certain things that have to be changed definitely."
Troicki's home federation described the verdict as "humiliating and disappointing."
"Serbia's Tennis Association is deeply disappointed with such a decision," it said in a statement. "Viktor Troicki has been inflicted a major injustice."
ITF President Francesco Ricci Bitti said rules had to be applied strictly "to keep our sport clean."
"What is harder to accept is criticism of doping control officers who perform a difficult role," Ricci Bitti said in a statement.
World No. 1 Rafael Nadal also expressed support for Troicki, who he called "a good guy."
"I hope to see him back on tour next year," Nadal said at the ATP World Tour Finals in London. "The doctor who accepted to make the control the next day, if that's that way, that's a big mistake from the doctor, too."
The CAS panel acknowledged that the tournament anti-doping officer "should have informed the player in clearer terms of the risks caused by his refusal to undergo a blood test."
The court added "there was no suggestion that Mr. Troicki intended to evade the detection of a banned substance in his system."
The three-member CAS panel said that Troicki and the doping official, a Ukrainian doctor, gave their evidence in good faith in Lausanne one month ago.
However, the panel's ruling published by the ITF noted that "the recollection of the athlete in particular was colored by his subsequent reconstruction of events."
A one-year ban was considered a "just and appropriate sanction" by the panel, and the minimum required in such a case according to ITF anti-doping rules.
The ITF tribunal in July declined to impose the standard two-year ban for a first anti-doping violation because it accepted Troicki was stressed by illness on the day and his long-standing needle phobia.
The ITF said Troicki remains disqualified from the Monte Carlo Masters, but retains his prize money and ranking points from subsequent events, including his run to a fourth-round loss against Jo-Wilfried Tsonga at the French Open.
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AP Sports Writer Samuel Petrequin in London and Associated Press writer Jovana Gec in Belgrade, Serbia, contributed to this report