Major redevelopment of the Bowl in Douglas is now unlikely to go ahead before the Commonwealth Youth Games, due to be hosted by the Isle of Man in 2011.
A ?2.5 million scheme had been under consideration, to provide a prestigious new venue to be used for the event.
The development would have included seating for 4,500 people.
Douglas Council leader David Christian was hoping a new national stadium could be created for the Island, but concedes the global economic downturn means that is now unlikely to happen.
He said all along that funding from other parties, including the Manx government, would be essential if the scheme was to progress, but says recent statements in Tynwald by Tourism and Leisure Minister Martyn Quayle suggest that won't happen.
Councillor Christian says Douglas Corporation, which owns the Bowl, is committed to continuing with a ground survey of the site to assess the feasibility of future improvements to the pitch, including drainage.
(Picture: A computer generated image of how a proposed canopy stand would have looked at the Bowl).
Researching your Manx family history can be a very interesting and rewarding hobby. Trace your roots in the Isle of Man with our helpful of guide.
