Canadian national Mohammed Fahmy, Australian journalist Peter Greste and Egyptian producer Baher Mohammed were jailed for three years following an appeal.
The three men were working for Al-Jazeera English following the 2013 military ousting of Islamist president Mohammed Morsi.
At the trial prosecutors used news clips about Christian life in Egypt and about an animal hospital with donkeys and horses, as evidence they broke the law.
Defence lawyers dismissed the videos as irrelevant.
Mr Greste, deported in February, spoke to Al-Jazeera from Sydney and criticised the verdict while Mostefa Souag, Al-Jazeera English acting director-general, said it "defies logic and common sense".
"The whole case has been heavily politicised and has not been conducted in a free and fair manner," Mr Souag said in a statement.
"There is no evidence proving that our colleagues in any way fabricated news or aided and abetted terrorist organisations, and at no point during the long drawn-out retrial did any of the unfounded allegations stand up to scrutiny."
The case began in December 2013 when Egyptian security forces raided the hotel suite used by Al-Jazeera at the time to report from Egypt.
Authorities arrested the trio, later charging them with allegedly being part of Mr Morsi's Muslim Brotherhood, which authorities have declared a terrorist organisation, and airing falsified footage intended to damage national security.
Since Mr Morsi's ouster, Egypt has cracked down heavily on his supporters and the journalists were accused of being mouthpieces for the Brotherhood.
Al-Jazeera and the journalists denied the allegations, saying they were simply reporting the news.
Human-rights lawyer Amal Clooney criticised the sentences, saying that "everyone has said there is no evidence to sustain any of the charges".
She said: "The verdict today sends a very dangerous message in Egypt.
"It sends a message that journalists can be locked up for simply doing their job, for telling the truth and reporting the news.
"It sends a dangerous message that there are judges in Egypt who will allow their courts to become instruments of political repression and propaganda."
Amnesty International called the sentences the "death knell for freedom of expression in Egypt".
Philip Luther, director of Amnesty's Middle East and North Africa programme, said: "The fact that two of these journalists are now facing time in jail following two grossly unfair trials makes a mockery of justice in Egypt.
"Today's verdict must be overturned immediately. Mohamed Fahmy and Baher Mohamed should be allowed to walk free without conditions.
"We consider them to be prisoners of conscience, jailed solely for exercising their right to freedom of expression."