In a statement, the Pakistan Foreign Office said it will take further action in the light of legal advice received.
Pakistan said it has taken note of the judgment by the High Courts of Justice of the UK in the Hyderabad Fund Case, after a two weeks trial in June 2019.
It said the "judgment rejects the longstanding claims of the two major parties and upholds the claims of the heirs of Nizam of Hyderabad".
"The ruling does not take into account the historical context of the transfer when India illegally annexed Hyderabad in violation of International Law and all civilized norms, leading the Nizam of Hyderabad to make desperate efforts to defend his people and the state from Indian invasion," it said.
"The Nizam also raised the matter with the UN Security Council where the issue remains on the agenda to date. The Nizam as a sovereign approached Pakistan for assistance which the Government of Pakistan provided.
"Pakistan is closely examining all aspects of the detailed judgment and will take further action in light of legal advice received," the Foreign Office said.
Earlier, the UK High Court ruled in favour of India in the 70-year-old legal dispute involving pounds 35 million that belonged to the erstwhile Nizam of Hyderabad and was kept in London's National Westminster Bank.
The Fund was being held in the account of the then High Commissioner of Pakistan to the UK, Habib Rahimtoola since September 1948.
( With inputs from IANS )