Members of the Crown Nominations Commission, which includes Dr Rowan Williams, the Archbishop of Canterbury, rejected calls for Dr Jeffrey John to be made the next Bishop of Southwark.
Conservative Anglican leaders had warned that evangelical parishes would not recognise him as a bishop and instead would seek “alternative episcopal oversight”.
But the snub will infuriate liberal clergy who believed he was the outstanding candidate and that his appointment would signal a move towards greater inclusion for homosexuals in the Church.