Blackpool Council has withdrawn its application for city status at the last minute.
The town's new Labour administration declared itself out of the running for the accolade which is to commemorate the Queen's Diamond Jubilee.
Council leader Simon Blackburn said he was not convinced it would benefit the town saying it was "a distraction".
The deadline for local authorities to submit their applications is Friday.
"It is about saving money but it's also about priorities and it's about time," said Mr Blackburn.
"I don't want council officers spending their time being distracted by something like the city bid."
'On the map'
Blackpool's neighbour and local rival Preston was one of the last cities created in 2002 to mark the Golden Jubilee.
But Mr Blackburn said he was unconvinced the accolade would bring any significant benefits to Blackpool.
And he added that the cost of the bid would be better spent on "cleaning up dog muck, on back alleys, on litter bans, on cleaning the streets - the basic workaday stuff that people want you to do."
He added: "The arguments I've had thus far are that it would put Blackpool on the map.
"Well, I've travelled all over the country and I've never met anybody that hadn't been to Blackpool because they didn't know where we were."
In January, StayBlackpool - which represents 200 of the resort's hoteliers and guest house owners - said city status would enhance the improvements being made to the seafront, the Blackpool Tower and the Pleasure Beach.
But president Claire Smith said that on this occasion she agreed with the decision to drop the bid.
"Publicity like that is always good but we have to weigh it up.
"Blackpool is on the map already and, when the council is having to make cuts and jobs losses, it doesn't seem the right time to put in for it."
There are 66 cities in the UK - 50 in England, five in Wales, six in Scotland and five in Northern Ireland.
In the North West, Stockport and Bolton have both declared their ambitions to enter the race to become England's newest city.