BBC Radio is scrapping the Electric Proms after five years as part of budget cuts.
Radio 2 controller Bob Shennan says the station can achieve the same impact in a different and more cost-effective way.
The corporation confirmed today in a statement that the music festival will not be held in 2011.
The Electric Proms was designed by the BBC to create new moments in music by inviting legendary artists to present one-off collaborations and performances. Past artists who have performed at the festival include Sir Paul McCartney, Dame Shirley Bassey, Burt Bacharach, Oasis, Robbie Williams, Doves and Mark Ronson. The 2010 event was the first to be solely run by Radio 2 and featured Sir Elton John, Robert Plant and Neil Diamond.
Bob Shennan, Controller, BBC Radio 2 and 6 Music, said: "In the current climate, we are faced with making difficult decisions, including how best to deliver high-quality live music programming throughout the year in light of continuing efficiency savings. I feel that Radio 2 can achieve the same impact of the Electric Proms in an alternative, more cost effective way. I'm disappointed that the lifetime of Electric Proms has come to an end, but very proud of its fantastically rewarding run of creating new moments in music for the past five years."
Jeff Smith, Head of Music, BBC Radio 2 and 6 Music, said: "Radio 2 remains as committed as ever to live music programming, and we will replicate the spirit of Electric Proms within the live music schedule."
In addition to Electric Proms last year, Radio 2 featured live performances ranging from Paolo Nutini performing in Paisley to Paloma Faith at the Cheltenham Jazz Festival; Scissor Sisters performing live on Ken Bruce's mid-morning show to Bryn Terfel singing Christmas classics at the Mermaid Theatre for Friday Night is Music Night.
Jeff added: "Only last week we took the Manic Street Preachers back to their home town of Blackwood in Wales to perform an exclusive gig which was broadcast live on both Radio 2, streamed online and available on Red Button the following day, and we intend to create more of these special moments throughout 2011. It's also our ambition to work with BBC Two again very soon as the radio/television/online offering was hugely enjoyed by listeners and viewers."