There are no future plans to develop the Navitus Bay site off the south coast, the Crown Estate said.
Permission for the 121 turbines off the Dorset, Hampshire and the Isle of Wight coast was refused by the Department of Energy and Climate Change.
No appeal is being lodged. Opponents said it would have damaged tourism and was too close to the protected coast.
The Crown Estate said the area would be handed back by Navitus Bay and there were “no future development plans”.
It holds the rights to the seabed up to 12 nautical miles off the coast.
This area had been identified in the third round of leasing for potential off shore wind farm sites, but a spokeswoman said there was no automatic right to develop and there were “no future plans to re-let that site”.
It is only the second time the Department of Energy and Climate Change has rejected an offshore project.
The £3.5bn Navitus Bay plan was developed jointly by Dutch firm Eneco and French giant EDF Energy A, would have seen up to 121 8MW turbines at 200m (656ft) high constructed.
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