The decision by Dun Laoghaire Rathdown County Council comes more than 30 years after the site was first selected.
The council owned site close to Mount Anville School - was first proposed for a Traveller halting site in 1985.
However, it's remained vacant after local opposition.
The Irish Times reports that the site was recently earmarked for homes for five families.
However, it has now been removed from consideration in the council’s Draft Traveller Accommodation Programme.
The land was last year valued at 15 million euro, if the designation for Traveller housing was removed.