Ministers have announced that Tottenham Hotspur has withdrawn its bid for a judicial review over what happens to the Olympic Stadium after the 2012 Games.
The Government announcement came after the deal to award the stadium to West Ham United after London 2012 collapsed amid fears over legal delays.
The Olympic Park Legacy Company (OPLC) claimed the deal broke down under pressure from the legal battle with Tottenham Hotspur.
The club has yet to issue any comment on the bid withdrawal in the wake of the Department for Culture, Media and Sport (DCMS) announcement.
A legal hearing had been scheduled to take place on Tuesday, however it is thought this will not happen now.
A DCMS spokeswoman said: “We have come to an agreement with Tottenham Hotspur, where all parties will bear their own legal costs.”
The OPLC hammered out an agreement with Mayor of London Boris Johnson and ministers to keep the ground in public ownership.
The decision was reached amid fears that a legal battle would leave the stadium unoccupied for a long period of time.
Following the ownership decision, West Ham announced plans to bid to become the stadium’s tenant.
West Ham and other bidders interested in becoming the stadium’s tenant were asked to submit proposals by the beginning of next year.
After the Games, the stadium will be downgraded from 80,000 seats to 60,000 seats with the help of a £35m public cash pot.
Leyton Orient has also withdrawn its bid for a judicial review after initially lodging a complaint about the award of the stadium.
It had suggested that West Ham moving to the ground could have impacted upon numbers coming through the gates at its own ground.
Chairman Barry Hearn said: “The whole process has been flawed. The last four or five years has been largely wasted and we have to go back to the beginning.
“If the OPLC try to fast track the whole process they will be challenged again.
“Someone has to convince me how Leyton Orient, with its history in east London, can keep in existence.”
Meanwhile, talks between Tottenham and Boris Johnson are ongoing over the building of a new stadium.