Two more Republican senators have said they oppose their party's replacement for President Obama's health system, making it impossible for the bill to pass in its current form.
Mike Lee and Jerry Moran say the new legislation does not go far enough in repealing the health legislation.
Republicans have been divided on the issue, with moderates concerned about the effects on the most vulnerable.
President Donald Trump made repealing Obamacare a key campaign pledge.
"Regretfully, it is now apparent that the effort to repeal and immediately replace the failure of Obamacare will not be successful," Senate Majority Leader Mitch McConnell said.
The Republican plan had kept key Obamacare taxes on the wealthy, while allowing insurers to offer less coverage and imposing sharp cuts to healthcare for the poor.