New Zealand on Air has rejected MediaWorks bid for funding for a new daily soap opera.
The series, called Trinity Point and touted as New Zealand's answer to Home and Away, needed several million dollars of funding to proceed.
A press release from NZoA said the project was given serious consideration but was not supported as it was not a priority.
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MediaWorks group entertainment content director Andrew Szusterman put out a statement expressing his dismay at the decision.
"We are extremely disappointed with New Zealand on Air's decision. Outside of bringing some fresh, local drama to Kiwi audiences, this would have made a significant and on-going contribution to New Zealand's production industry and provided many on-going jobs for the creative sector."
Instead, NZoA opted to fund a third season of the popular South Pacific Pictures series The Brokenwood Mysteries, committing more than $4 million of funding to the project.
"We have been delighted by the quirky characters and storylines. The murder-mystery genre is a difficult one to crack, and South Pacific Pictures and the writers have achieved that," said NZoA chief executive Jane Wrightson.
In a statement, Ms Wrightson said the funding body's drama budget is under unprecedented pressure, with more projects seeking support than funds available.
"Nonetheless we have a good mix of new and returning drama projects for 2016 which need time to establish themselves. It's important that, where possible, NZ On Air supports quality returning drama series. This ensures the most effective use use of scarce funds and give producers and broadcasters some degree of certainty in this most complex of genres," said Ms Wrightson.
Trinity Point was pitched to fill the 5.30pm weekday slot on TV3, vacated by Home and Away in 2013.