Carolyn Franks, owner of the petting zoo, said she would appeal the decision to the San Juan Capistrano City Council.
Franks bought the statue in June to install as an attraction for kids at the petting zoo. The Capistrano Historical Alliance Committee objected to the dinosaur statue because it conflicted with the area's historic emphasis.
The 40-foot long replica dinosaur was placed without city review and permits.
The Cultural Heritage Commission held a meeting on Nov. 27, 2012, and decided to let the zoo keep the dinosaur, saying it was no longer offensive.
Tuesday, the statue was ruled inappropriate by the planning commission.
