The Wearmouth-Jarrow bid for World Heritage status is "shelved" after an evaluation by the International Council on Monuments and Sites (ICOMOS).
The bid centred on the monastery of St Peter's Church in Monkwearmouth and St Paul's Church in Jarrow.
The Bishop of Jarrow, the Right Reverend Mark Bryant, chair of the partnership behind the bid, said he was "disappointed" about the evaluation.
However, he adds that that the plan could be resubmitted at a later date.
'Strong local support'
The decision to withdraw was made jointly by the Department for Culture, Media and Sport (DCMS), English Heritage and the Wearmouth-Jarrow Partnership.
Bishop Bryant said: "It's important to say that it is shelved.
"The reason it was withdrawn is that if it had gone right through to the committee and they had said no, then we would not have been able to put it in again.
"So we have withdrawn it to give us the option to put it forward again."
In a statement a DCMS spokesperson said: "Clearly, everyone involved is disappointed with the recent ICOMOS evaluation.
"There is strong local support for the world heritage bid and the team there have done some great work, which ICOMOS have acknowledged.
"We will study the report further to look at what still needs to be done, building on the work so far."