Alnwick Castle in Northumberland was transformed into Hogwarts

Alnwick Castle and Durham Cathedral, which featured in the first two Potter films, have been ditched by film-makers.

Warner Bros, which owns the rights to JK Rowling's child wizard books, is to use digital effects and other locations in Scotland for the third film - Harry Potter and the Prisoner of Azkaban.

The decision is a blow to the economies of Northumberland and Durham, which saw several million pounds spent in the area during the production of the first two hit movies.

Alnwick Castle was twice transformed into wizard school Hogwarts, and two small towns were created at Durham's old cricket ground.

Northumberland alone has enjoyed a 20% boom in visitors since the first film, Harry Potter and the Philosopher's Stone, was released in November 2001.

Closed set

Paul Mingard, screen commissioner with Northern Film and Media, the organisation which promotes the region to potential film-makers, said he was "disappointed" at the move.

And a spokeswoman for the Northumbria Tourist Board said the decision would cost the region millions in lost income.

The bulk of the new film is to be shot on a closed set at Leavesden Studios in Watford.

External scenes are to be shot in Glencoe in the Scottish Highlands.

Mr Mingard said: "The change seems to be because of a change in director for the new film.

"The director of the first two films, Chris Columbus, had a very good relationship with us.

"But it appears that the third film has such a huge special effects budget that they have decided not to use Alnwick or Durham this time.

'Financial benefits'

"We understand that Chris is returning for the fourth instalment and we are hopeful he might return to the North East too."

Mr Mingard said during filming of the second movie, Harry Potter and the Chamber of Secrets, the 350-strong crew spent more than �500,000 on hotel accommodation alone.

A spokeswoman for the Northumbria Tourist Board, said: "Obviously we are disappointed.

"There have been significant financial benefits from our connection with the film, which easily goes into the millions of pounds.

"However, we remain hopeful that Warner Bros will come back to the North East."

Warner Bros has refused to comment on any aspect of their filming schedules.