The High Court refused to rule in a case brought by campaign groups seeking to exclude him from the 4 March poll.
Mr Kenyatta and Prime Minister Raila Odinga are seen as the favourites.
Mr Kenyatta and his running mate William Ruto deny the charges brought against them in The Hague.
They are due to go on trial in April at the International Criminal Court (ICC) in connection with the violence that followed disputed elections in 2007.
"The High Court lacks jurisdiction to deal with a question relating to the election of a president," the panel of five judges said in a statement read to a crowded courtroom.
I have repeatedly said that my main competitor should have the opportunity to face me in a free and fair election, whose outcome is determined by the people of Kenya” Raila Odinga Prime Minister
"This is an issue that is within the exclusive jurisdiction of the Supreme Court," the judges said.
The BBC's Will Ross in the capital, Nairobi, says Mr Kenyatta's supporters celebrated in the streets after the ruling was announced.
Correspondents say it is not immediately clear if any application would be made to move the case to the higher court.
Edgar Kavu-Lavu from the International Commission of Jurists (ICJ) – one of the civil society groups to bring the case to court – says they won't appeal as there is not enough time before the elections are held.
The ICC case against four Kenyans – including Mr Kenyatta and Mr Ruto – is taking centre stage in the elections and was an issue that featured prominently in the first presidential debate last week between the eight leading candidates for the post.
Mr Kenyatta was forced to fend off claims of impunity during the debate and was put on the spot by the moderators and his presidential challengers who demanded to know why he would not pull out of the race to concentrate on his case at The Hague.
Both he and Mr Ruto have been indicted by the ICC for crimes against humanity emanating from the violence that killed more than 1,000 people and forced about 300,000 people from their homes after the disputed election that was won by President Mwai Kibaki, who is now stepping down after two terms.
Mr Odinga said he welcomed the High Court ruling.
"I have repeatedly said that my main competitor should have the opportunity to face me in a free and fair election, whose outcome is determined by the people of Kenya," he said.
Mr Kenyatta, the son of Kenya's founding president, faces five charges of crimes against humanity, including murder, rape, persecution, deportation and other inhumane acts.
Mr Ruto faces three charges of crimes against humanity.
Mr Kenyatta insisted during the debate that he and his running mate were innocent and would defend themselves vigorously.
The case would not prevent him from discharging his presidential duties, if he was elected, he said.
The Kenya Human Rights Commission, the Kenyan branch of the ICJ, and the International Centre for Policy and Conflict have all argued that any person committed to trial at the ICC would not be able to carry out their duties of running the country properly.
They say that the honour and integrity of the public office would be damaged.