The controversial system used to match junior doctors to specialist training posts has been shelved by ministers.
Some doctors want the whole recruitment process scrapped
Health Secretary Patricia Hewitt said that after the first round of recruitment, the system would only fulfill a monitoring role this year.
Instead, the subsequent recruitment rounds will be CV-based, and handled at a local level by medical deaneries.
Doctors had complained the system was profoundly flawed, and that many juniors had been unfairly treated.
Juniors had to apply for a job through a system known as the medical training application service (MTAS).
But the system ran into serious trouble with many complaining about a lack of posts, poorly designed recruitment forms and technical failures with the online application system.
The doctors were angry about the way everyone was made to apply for training places at the same time, rather than the old rolling recruitment process which allowed them to keep on trying for jobs as they came up.
They feared those who missed out in the first round of recruitment would not be able to get back on the career ladder towards becoming a consultant.
It also emerged that the MTAS website had been the subject of two security breaches.
Ms Hewitt told the Commons earlier this month she was confident that criminal offences had not been committed.
But following further investigations a report has been sent to the police.
A campaign group of doctors, Remedy UK, has launched a legal challenge with the aim of getting the whole recruitment process scrapped.
However, ministers are committed to seeing through the first round of the recruitment process.
They said every eligible applicant in the first round had now been guaranteed at least one interview for their first preference post, and as a result an additional 15,500 interviews had been arranged, and were now taking place.
Only doctors who fail in the first round of recruitment will go to second and subsequent rounds.
The British Medical Association welcomed the decision to suspend the use of MTAS.
Dr Andrew Rowland, vice chairman of the BMA Junior Doctors Committee, said: "The Department of Health has at last seen sense and effectively abandoned the unfair, discredited, and shambolic MTAS system.
"Junior doctors have suffered blow after blow because of the government's terrible handling of these reforms.
"They have had to go through months of anxiety about their NHS careers, and on top of that, have potentially had their personal details exposed on the MTAS website."
However, Dr Rowland said the BMA remained opposed to the Remedy UK legal challenge, saying that scrapping the first round of applications would be disastrous for doctors, for patients, and for the NHS.
"Forcing people to re-apply for jobs through yet another new and untested system would be unfair on the junior doctors and consultants who have had to spend huge amounts of time and energy on MTAS."
Dr Matt Jameson Evans, a spokesman for Remedy UK, was unimpressed by the government move, which he called a "grandiose smokescreen statement" intended to divert attention away from the fact that thousands of doctors had suffered at the hands of MTAS.
He said: "The system has been down for weeks.
"I fail to see how they could have envisaged using it. This was the only option on offer - which they have presented as a decision."
A review of MTAS will decide whether the system should be reinstated in future years.