Visitors from Europe rose in 2007
Fewer people visited London last year despite predictions numbers would exceed 2006 figures, the city's tourist board Visit London show was told.
A downturn in foreign visitors in the last six months of 2007 meant 25.45 million people came to London compared with 26.6 million the year before.
But the figures did show the amount spent by visitors rose 3.4% to £10.4bn.
In May tourism bosses said the "credit crunch" and "faltering economic growth" would mean a tough year for London.
The figures showed that while foreign visitor numbers rose 6% in the first six months of last year, total numbers were down 7% in the last six months.
Overall there was a 4% drop in the number of people, including Britons, who stayed in the city for at least one night.
Visit London said while European visitor numbers had risen last year, visits from North America had remained flat.
It said numbers had been affected by weak consumer confidence and the "credit crunch".
Visit London chief executive James Bidwell said: "With uncertain economic times ahead, London's tourism industry could be facing its toughest conditions for some years.
"However, with strong visitor growth since 2005, London faces any economic slowdown from a position of strength."