The canal was officially closed to navigation in 1962
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Multi-million pound plans to re-open the Grand Western Canal appear to have been shelved.
The Grand Western Canal Trust has campaigned for several years to have the historic waterway between Tiverton and Taunton re-opened.
But Somerset County Council's waterways advisory committee said the £62m needed for the project was not justified.
It said some smaller projects could take place, but re-opening the whole canal was unlikely.
Work started on the Tiverton section of the canal in 1831 and the Tiverton branch line was opened 17 years later.
Although parts are still in use, the canal was officially closed to navigation in 1962.