Stadler was arrested in mid-June as part of a broader probe into emissions cheating at the premium brand, which is part of Volkswagen.
He was detained on fears he would seek to influence witnesses being questioned as part of an investigation into Volkswagen's emissions scandal.
"The Chamber emphasizes that danger of obstructing justice remains. The release of the accused from custody was therefore rejected," the Munich court said in a statement.
Stadler, who stepped down in June, had asked to be released from custody and appealed against his arrest, the Munich prosecutor's office said.
The prosecutors are probing Stadler and another member of Audi's top management for suspected fraud and false advertising tied to illegal pollution levels in its cars and manipulated vehicle tests.
(Reporting by Irene Preisinger; Writing by Edward Taylor; Editing by Douglas Busvine and Mark Potter)
