The annual event, which is organised by the Moffat Promotions Group, has been scrapped following a licensing issue.
A spokesman for the events group said: “It is with deep regret that Moffat Promotions Group have to announce that the sheep races will not be taking place on Sunday in the town.
“This is a decision that certainly hasn’t been taken lightly and is one all members are very disappointed to have had to take.”
He added: “The group’s hand has been forced by legal matters outwith our control; namely the Performing Animals Act of 1925, which Dumfries and Galloway Council were asking us to comply with.
“This would have meant that the sheep taking part in Sunday’s race would have had to have been licensed to perform and this was a step those involved in the organisation of the event weren’t willing to undertake especially at such short notice and we respect their decision.”
Last month an online campaign to see the event axed on the grounds of animal cruelty was created, gaining over 80,000 signatures.
The woman behind the petition, Samantha Francis, gathered support from animal rights group PETA and even penned a song with her husband, Joshua, to help promote the petition.