Town chiefs are to look at other ways of providing a bigger library
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Plans to provide more affordable housing and a new library for a Dorset town have had to be shelved.
Council bosses have blamed legal, funding and design issues for the proposed scheme for Blandford's West Street failing to materialise.
The county and North Dorset district councils had teamed up with East Dorset Housing Association to share the costs and manpower needed for the scheme.
But they have announced the partnership could not go ahead with the plans.
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It is essential that any project enhances the town properly and strikes the right balance for housing people
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They have, however, said it will look at other options, including improving existing facilities.
Alan Havelock, Dorset County Council's cabinet member overseeing libraries, said: "We are extremely disappointed that we cannot now take the proposed scheme forward, especially as Blandford has needed a new library for so long.
"But we will continue to explore all the options to see if there is a way forward."
David Whitehead, leader of North Dorset District Council, added: "Blandford is one of the finest Georgian towns in England and also has a waiting list for suitable affordable housing.
"It is therefore essential that any project enhances the town properly and strikes the right balance for housing people."