"Two years in prison for Drareni. We are going to appeal to the supreme court," lawyer Mustapha Bouchachi said.
Although Drareni's sentence was reduced by a year from an August judgement, press freedom watchdog Reporters Without Borders (RSF) condemned it.
"We are outraged by the blind stubbornness of the Algerian judges who have just condemned (Drareni) to 2 years in prison," RSF secretary general Christophe Deloire tweeted after the verdict was announced.
"Khaled's detention proves the regime locks itself into a logic of absurd, unfair and violent repression."
Drareni, 40, has been in custody since March and was sentenced in August to three years in jail for his coverage of Algeria's year-long anti-government demonstrations.
The prosecutor had originally called for a four-year prison sentence.
Editor of the Casbah Tribune news site and correspondent for French-language TV5 Monde, the journalist was found guilty of "inciting an unarmed gathering" and "endangering national unity".
He was also accused of having criticised on Facebook the "corruption and money" of the political system and having published a statement from a political coalition in favour of a general strike, according to RSF, for which Drareni also works.
“Today’s prison sentence for prominent journalist Khaled Drareni is a mockery of justice in a country supposedly undergoing political change and transformation following mass protests," said Amna Guellali, Deputy Regional Director for the Middle East and North Africa at Amnesty International.
"These harsh sentences underline the broader crackdown on freedoms in the country, and confirm an alarming pattern of prosecutions targeting journalists and activists who called for more democracy and respect for the rule of law in Algeria."
She recommended for the Algerian authorities to "unconditionally" release Khaled Drareni and others who are being detained for "daring to document police violence and arbitrary arrests during protests."
Khaled Drareni was tried along with Samir Benlarbi and Slimane Hamitouche, two figures of the protest movement known as "Hirak".
Facing the same charges, Benlarbi and Hamitouche were sentenced to four months in prison and released on time served.