Donald Trump has said he has cancelled his trip to London to open the new US embassy because he considers the building's relocation a "bad deal".
The US President tweeted: "Reason I canceled my trip to London is that I am not a big fan of the Obama Administration having sold perhaps the best located and finest embassy in London for 'peanuts,' only to build a new one in an off location for 1.2 billion dollars. Bad deal. Wanted me to cut ribbon-NO."
Mr Trump had been expected to visit the new £750m ($1bn) home for American diplomats on the banks of the River Thames as early as next month.
Sky News understands US Secretary of State Rex Tillerson will now undertake ceremonial duties at the official opening of the distinctively-shaped building.
The new Nine Elms site, near Battersea in London, is due to open on 16 January.
Despite Mr Trump blaming his predecessor for the decision, the embassy move from Grosvenor Square was initiated by the George W Bush administration.
A post on its website dated 8 October 2008 - just under a month before Mr Obama's election - revealed the plan.
It says: "The U.S. State Department today signed a conditional agreement with the real estate developer Ballymore to acquire a site in the Nine Elms Opportunity Area in Wandsworth for the construction of a new Embassy."
Mr Trump's tweet cancelling his visit sparked a welcome reaction from some politicians.
Mayor of London Sadiq Khan said: "It appears that President Trump got the message from the many Londoners who love and admire America and Americans but find his policies and actions the polar opposite of our city's values of inclusion, diversity and tolerance.
"His visit next month would without doubt have been met by mass peaceful protests.
"This just reinforces what a mistake it was for Theresa May to rush and extend an invitation of a state visit in the first place.
"Let's hope that Donald Trump also revisits the pursuit of his divisive agenda."
Former Labour leader Ed Miliband also replied: "Nope it's because nobody wanted you to come. And you got the message."
While Liberal Democrat Foreign Affairs spokesperson Jo Swinson said Mr Trump had "thrown his toys out of the pram".
It does not mean plans for the US President's state visit to the UK are off entirely, with a Downing Street spokesman telling Sky News: "An invitation for a state visit has been extended and accepted."
Mr Trump's tweet came hours after he asked why the US should allow more immigrants from "s***hole countries" in.
The profane remark came in a meeting with legislators about a bipartisan deal on immigration.
MPs have repeatedly called for the offer of a state visit for the US President to be withdrawn following his crackdown on immigration from majority-Muslim countries and promotion of far-right group Britain First on Twitter.
The controversy sparked a diplomatic spat between Theresa May and Mr Trump, after the Prime Minister condemned the US President's actions.
Any possible first trip to the UK by Mr Trump since being elected to the White House is likely to be met with fierce protests.
This week, Foreign Secretary Boris Johnson brushed off suggestions a state visit to Britain by Mr Trump should be scrapped.
It followed claims by Michael Wolff, the author of an explosive new book about Mr Trump, that the US President would use a visit to "Trumpalise the Queen and Buckingham Palace".
Mr Johnson told MPs: "I think Her Majesty the Queen is well capable of taking this American president - or indeed any American president - in her stride, as she has done over six remarkable decades.
"She has seen them come and she has seen them go."
In January last year, Mrs May was the first foreign leader to visit Mr Trump in the White House.