A series of smaller festive events - to be announced - will replace the popular Bury St Edmunds Christmas Fayre this winter.
Business and tourism bosses have expressed their disappointment over the news, but say they will work with partners to ensure companies and communities have the best Christmas possible.
For many town centre businesses, the fair weekend is the busiest trading weekend of the year, said Mark Cordell, chief executive of the town's Business Improvement District (BID).
West Suffolk Council, which organises the four-day Bury St Edmunds Christmas Fayre, said last year's event had to be postponed due to Covid-19 and this year it could not go ahead "due to the need to keep Covid-safe and be able to change as guidance does".
Planning for the Christmas in Bury St Edmunds campaign for 2021 is in its early stages, but it will include the festive lights switch on.
It will start in November and organisations and businesses are also invited to come forward with their events and ideas to be included in the programme.
Mr Cordell, chief executive of Our Bury St Edmunds, said: “While it is disappointing that the fayre will not be happening this year, we want to continue to make sure our businesses and communities have the best Christmas they can have this year and in the future.
"Christmas in Bury St Edmunds fits with the work the BID and our businesses have been doing for the Bury Bouncing Back campaign.
"We look forward to a range of events being delivered in the run-up to Christmas."
Melanie Lesser, chair of Bury St Edmunds and Beyond tourism group, said: “Our visitors and tourism businesses will be disappointed that the Christmas Fayre will not go ahead in Bury St Edmunds this year, but we look forward to working with partners this year to encourage visitors to the town over an extended festive period.”
So far organisations including West Suffolk Council, Bury St Edmunds Town Council, Our Bury St Edmunds BID, Bury and Beyond, St Edmundsbury Cathedral and the Arc shopping centre are working together on the plans for this Christmas.
The Very Reverend Joe Hawes, Dean of St Edmundsbury Cathedral, added: "Christmas is a time when families come together, and we hope that this year we can offer visitors a chance to enjoy a unique experience at the cathedral with a specially planned event and traditional carol services.”
Susan Glossop, portfolio holder for growth for West Suffolk Council, which will be running an event as part of the programme, said the Christmas events would help, over several weeks, to attract residents and families into the town to enjoy the festive period and support local businesses, employers and suppliers.
"Importantly it will be done in a Covid-safe way," she said.
She said they welcomed other community organisations to join in with the Christmas campaign.
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here