The US-appointed Iraqi Governing Council (IGC) has abandoned plans to sign a new interim constitution.
All preparations had been made for the ceremony
The announcement came nearly seven hours after the signing ceremony was to have taken place in Baghdad.
Five Shia members of the Council failed to turn up for the ceremony, demanding a revision of parts of the draft.
Informal consultations were expected to continue over the weekend but no signing was expected before Monday, IGC sources said.
The signing ceremony at a conference hall - complete with musicians and a children's choir - fell apart at the last minute.
NEW SHIA DEMANDS
A five-member rotating presidency, with more Shias
Removing minority rights to veto permanent constitution
"There will be no news releases tonight," said the coalition spokesman, who was not named.
"It is possible that there will be a sort of statement tomorrow."
The ceremony was initially postponed from Wednesday as Iraq mourned scores of people killed in blasts in Baghdad and Karbala.
Just hours before the constitution was due to come into effect, several mortar rounds hit Baghdad International Airport - the main US military base - and two large explosions echoed across the capital.
There were no reports of casualties.
There is apparently a dispute over two elements of the draft document - named the Transitional Administrative Law - which, until now, had not seemed to be at issue.
Shia members of the IGC are apparently calling for a collective presidency that includes three Shias, one Kurd and one Sunni Muslim. The draft stipulates a president and two deputies.
Iraq will have a president, two deputies, a prime minister and a cabinet
Bill of rights includes protections for free speech and religious expression
Islam will be one of a number of legislation sources
Women should make up 25% of assembly
Kurds remain autonomous
It is believed Shias also want to change the mechanisms by which a permanent constitution could be ratified, removing safeguards that would give minority groups a veto.
Clauses in the draft reportedly say two-thirds of voters in any three provinces can veto the permanent charter in a referendum.
"Some of these provinces have only 400,000 or 500,000 people. We cannot have that number of people rejecting a constitution for 25 million people," said Hamed al-Bayati, of the Shia Supreme Council of the Islamic Revolution in Iraq (Sciri).
The Kurds' self-rule region includes three provinces - and reports suggest the Shias may have now gone back on a pledge to give Kurds constitutional guarantees.
The interim constitution sets out the framework for how Iraq will be governed after the US-led coalition ends the occupation on 30 June and before a new government is chosen by national elections, supposedly by early 2005.
Supporters of the document say that it sets the standard for political freedoms and religious tolerance in an Arab country.
But the US-based Human Rights Watch criticised the interim constitution for what it said was a failure to give adequate protection to women's human rights.
Human rights groups say the draft inadequately protects women
The terms of the provisional constitution were agreed only after tortuous negotiations between the different ethnic and religious factions on the IGC.
The BBC's Paul Wood in Baghdad says everyone acknowledges that the Transitional Administrative Law is a temporary document.
Its provisions could be overturned by a nationally elected body.
The document does not specify which body will take over from the occupying powers by the end of June, nor does it say exactly how long elections will take to organise.
These issues are bitterly contested, with the Shias especially suspicious that elections will be delayed to deny them the political power they believe goes with their majority in the population.