Auckland Transport said several potential risks were identified with the trial including a reduction in cyclist safety and an increase in bus travel times.
"As a result, strict rules were set for taxi drivers along with some monitoring metrics.
"Despite a focus on educating approved taxi organisations and their drivers, the monitoring highlighted a widespread failure to adhere to the 30km/h speed limit on the bridge and the requirement for taxis not to overtake cyclists on the bridge.
"These issues were identified as significant concerns at the outset of the trial and a commitment was made to stop the trial if taxi drivers failed to adhere to these conditions."
Auckland Transport said Grafton Bridge would return to a bus lane only between the hours of 7am and 7pm from the end of the month.
Taxi Federation chief executive Roger Heale said he was disappointed with the result.
He said more than 600 cyclists used the bridge every day during the trial, but only two official complaints were laid.
"As the numbers of cyclists grew during the trial period it is clear nobody felt unsafe whilst taxis used the bridge," Mr Heale said.
"Whilst not condoning drivers exceeding the speed limit, it is an easy fault to fix and if the council really wants the sharing economy to flourish as hoped, far more effort is going to be required to elicit behavioural change rather than using the first failure as an excuse to cancel any future trial."