However, Greater Glasgow Health Board has refused to rule out a medium-secure psychiatric unit at the hospital despite the outcome of a consultation meeting which decided it was not the best option.
Health professionals and the local community had campaigned against the unit - which would house people with mental illnesses including medium risk criminals.
After two days of debate, a site at Belvidere Hospital - in the east end of Glasgow - has emerged as one of a number of possible options.
Campaigner Dr Fiona Johnston said she was delighted the board had been forced to think again.
She said: "This is the moment that the campaigners from the local community have been waiting for.
"From the point of view of the medical staff
"I think we felt that a good debate was had and it looked at all the options and all the criteria appropriately, and that, in fact, the right decision was come by."
Catriona Renfrew, of the Greater Glasgow Health Board, said this was not the end of the story.
She said: "I'm not suggesting that we overturn any decision or indeed make any decision. "
The board will "take stock" of the consultation process and a report from independent facilitators, she said.
Ignoring local concerns
The second consultation was forced upon the health board last year by the Scottish Parliament's health committee, which criticised the board for ignoring local concerns.
Residents had raised a vociferous campaign against the plans, expressing concern at intentions to house mentally ill criminals at Stobhill Hospital in North Glasgow.
They have received backing from medical staff at the hospital, who felt the views of local people should come first.
The proposed unit would have cost around £12.5m and have a total of 76 beds.
Acute services
The board said the unit was needed to bridge the gap between the maximum security of the State Hospital at Carstairs and psychiatric hospitals, which are not best suited to provide secure care.
Concerns have also been raised about the future of acute services at Stobhill Hospital.
Earlier this month retired GP Jean Turner came second, polling more than 7,500 votes, when she stood in a Holyrood by-election in Strathkelvin and Bearsden.
Dr Turner campaigned to ensure that acute services are not taken away from the hospital in Springburn.