Those in favour of hunting won just over half the votes cast in the keenly-contested vote.
Campaigners for the ban have conceded defeat.
There were jubilant scenes in the counting hall as the pro-hunt activists celebrated victory, which was achieved by only 2,200 votes.
The BBC's Mario Cacciottolo in a tweet says that hunters' association head Joe Perici Calascione is "ecstatic" about the outcome of the vote and has described hunting as an integral part of Maltese tradition.
Opponents of hunting say it will now be an "uphill struggle" to stop annual spring shooting of turtle doves and quail.
The issue has led to disagreements between conservationists and those who say a Maltese tradition is at stake.
Critics accuse hunters of killing scores of birds - they say that turtle dove numbers have declined 77% since 1980 - and encroaching on the island's open spaces.
They argued that the hunting season is abused by some hunters through the illegal shooting of protected species during a crucial migration period as birds fly over Malta into Europe.
About 340,000 people were eligible to vote in the referendum, which was held in response to a voters' petition for a ban on the hunting of birds between 14 April to 30 April.
The margin of victory was tiny - 50.44% to 49.56%.
Prime Minister Joseph Muscat who supported the hunters warned that existing laws would be rigidly applied and anyone who violated them would be punished.
The Times of Malta said that the "Yes" campaign successfully argued that a "No" victory could result in other pastimes, such as fireworks and motorsports, also being banned in referendums.
The paper says that hunting enthusiasts also succeeded in using the "pulling power" of Mr Muscat while simultaneously ensuring that their campaign was "characterised by an absence of images of shotguns and dead birds".
A second hunting season in autumn was not included in the referendum.
Malta is the only EU country that allows recreational spring hunting.
Malta has narrowly rejected proposals to ban controversial spring hunting, during which migrating birds are shot before they can breed.