This prize fund for next month's Irish Open will be 50% down on last year following the loss of the event's main sponsor.
Telecommunications company 3 pulled out of the sponsorship so the purse has been cut to £1.35m.
European Tour officials are confident that a new sponsor will be found for next year's event.
Rory McIlroy will play this year at Killarney from 28 to 31 July, as will Graeme McDowell and Padraig Harrington.
"There is a lot of sponsor interest but not in time to make it work this year," said European Tour chief executive George O'Grady.
"We're looking for a long-term sponsor and think we will get it."
Irish tourism authority Failte Ireland are providing financial backing for this year's event along with the European Tour.
2010 winner Ross Fisher picked up a cheque of approximately £450,000 for his victory but that figure will be halved for this year.