The move – which has been touted for years – had proved incredibly controversial amid complaints about Facebook's ad strategy.
In addition to facing intense criticism from users, arguments over the introduction of ads and plans to make more money from WhatsApp are thought to be part of the reason that the company's two founders both publicly left their jobs.
Before they sold the app to Facebook, WhatsApp's creators had criticised ads and committed not to bring them to the chat app.
Now the Wall Street Journal reports that the team that had been working on the ads plan has been broken up. Their work on the app has been removed from the code, the paper reported.
Ads could still find their way into some parts of WhatsApp. Facebook might add advertising to the Status feature, but it will stay ad-free for now.
Instead, Facebook will focus on letting businesses message customers through WhatsApp, a feature that already exists in Facebook Messenger, the Journal reported. The company is now focusing on tools to "allow businesses to communicate with customers and organise those contacts", it said.
Similar plans were also criticised by Jan Koum and Brian Acton, the founders of WhatsApp. They argued that adding such features would require weakening the security of WhatsApp, which is end-to-end encrypted so that only the sender and recipient of an email can see a message, and not Facebook.