The FA has owned Wembley since 1999 having bought it from Wembley plc, a private firm which previously owned the stadium
Fulham owner Shahid Khan has withdrawn his offer to buy Wembley Stadium from the Football Association after the plan became "divisive".
Khan had offered £600m for the national stadium, with the FA retaining the Club Wembley hospitality rights, which it valued at £250m to £300m.
The move was "more divisive than expected", said FA chief Martin Glenn.
Khan has not ruled out making another bid in future if there is more support from FA Council members.
The FA had said it would invest the proceeds of the sale into improving grassroots football facilities.
Sports Minister Tracey Crouch told the BBC she was "very disappointed" by the decision, calling the offer "a huge opportunity to boost funding into the development and maintenance of artificial and grass pitches up and down the country".
FA executives made a presentation to the FA Council last week about why they were backing the sale to Khan, and the 127 council members were scheduled to vote on the proposed sale on 24 October.
But a senior FA source told BBC Sport that the board believed the odds were slightly against the purchase being backed, given the strong objections of some councillors to the home of English football being sold off.
FA chief executive Glenn said Khan had believed his offer "would be well received by all football stakeholders".
However, Glenn added: "At a recent meeting with Mr Khan he expressed to us that, without stronger support from within the game, his offer is being seen as more divisive than it was anticipated to be and he has decided to withdraw his proposal.
"Wembley Stadium is an iconic venue that is revered around the world and it will continue to thrive under the ownership and direction of the FA."
Khan said he wanted "to do right by everyone in a manner that strengthens the English game and brings people together, not divides them".
He added: "Unfortunately, given where we are today, I've concluded that the outcome of a vote next week would be far from sufficient in expressing the broad support favoured by the FA chairman to sell Wembley Stadium.
"Until a time when it is evident there is an unmistakable directive from the FA to explore and close a sale, I am respectfully withdrawing my offer to purchase Wembley Stadium."
Khan, who also owns the NFL American football team the Jacksonville Jaguars, added: "Our commitment to London would have been amplified and strengthened with the certainty of officially making Wembley Stadium an annual host to Jaguars or other NFL games."
The FA had pledged to keep showpiece events, such as most England internationals and the FA Cup final, at the stadium under a pre-agreed hire fee.
Reaction to collapse of sale
The Football Foundation charity, which helps fund grassroots projects, said a "once in a lifetime" opportunity to improve facilities had been lost.
"Unfortunately, those who play the game as a sport, simply for the love of doing so and for the health benefits, are having to put up with a stock of community football facilities that is in a shameful state," it added.
Other supporters, however, were concerned over the possibility of rising ticket prices for Wembley games, loss of control over the ground's future development and the stadium becoming the home of a new owner's club side, Football Supporters' Federation chairman Malcolm Clarke said.
"More than 2,000 supporters took part in our consultation on the Wembley sale and we took that fan feedback directly to the FA Council last week. Only one in three fans thought the FA should sell to Khan while two-thirds of supporters were against selling the stadium under any circumstances," he added.
-- Courtesy of BBC Sport