York St John University has backed down over plans to buy part of Union Terrace coach and car park.
Plans to sell part of the site to the university had been approved by the City of York council, and options for the sale were at a consultation stage.
The vice chancellor of the university said it had decided to reconsider after taking part in the consultation.
Traders on Gillygate had objected to the sale, believing they would lose passing trade.
More than 22,000 people had signed a petition opposing the sale.
Vice chancellor of YSJU, Prof David Fleming said: "Last year we entered into constructive discussions with City of York Council regarding the possible purchase of land at Union Terrace.
"Having participated in the consultation we have concluded that we need to reconsider.
"We will now work with the council and other stakeholders in the city to develop alternative plans to ensure that York St John University is able to build on its success and continue to be an important economic driver in the city."
Trevor Fenwick, who represents traders on Gillygate in York, said: "This is a fantastic result.
"This is really good for the people and businesses in York. We've had a lot of support and I really appreciate what everyone's done."
Council leader, James Alexander, said: "Naturally, we are disappointed that despite all the work that has been done, YSJU have chosen to withdraw their proposed plans for expansion on the Union Terrace site.
"We will continue to work with partners, including York St John University, to bring new jobs, opportunities and growth to the city, now and in the future."
- 5 August 2011
- 4 August 2011
- 5 July 2011