The sale of the Grade II-listed prison where Oscar Wilde was held has fallen through, the Ministry of Justice (MoJ) has said.
Developer Artisan Real Estate had been due to buy Reading Prison for an undisclosed sum.
The MoJ said the bidder had since withdrawn and a decision on the next steps would be made "in due course".
Reading Borough Council hopes it can revive its bid to purchase the site and transform it into an arts complex.
The authority's previous bid was rejected in April.
Deputy leader Tony Page said the council was now calling for an "urgent meeting" with Justice Minister Robert Buckland.
Labour MP for Reading East Matt Rodda said he was writing to Prisons Minister Lucy Frazer to see if the council plan could be revived.
"In many respects this should be a World Heritage Site with its connections to Oscar Wilde and what it means to LGBT people," he said.
The jail, near Reading Abbey Ruins, famously housed Wilde between 1895 and 1897.
He was convicted after his affair with Lord Alfred Douglas was exposed.
Following his release, Wilde composed The Ballad of Reading Gaol inspired by his time as a prisoner and in which he reflected on the brutality of the Victorian penal system.
The tomb of King Henry I is also believed to be buried under the car park at the prison, which was put up for sale by the MoJ last year and has been disused since 2013.
In a statement, a Prison Service spokesman said: "The bidder for the former Reading prison site has withdrawn and a decision on next steps will be made in due course."
He said it would "seek the best outcome for taxpayers".
Artisan Real Estate, based on the Isle of Man, has not yet responded to a BBC request for comment.