Thousands turned out in protest at the plans last February

The proposed centre, at HMS Daedalus in Lee-on-Solent, Hampshire, attracted bitter opposition from local people.

As many as 8,000 people marched in protest at the plans, which would have seen 400 single men housed at Daedalus as their applications were considered.

The Home Office said that after a detailed examination, it would not seek planning approval for the centre.

Common sense has prevailed, it was the wrong plan in the wrong place John Beavis Daedalus Action Group

Home Office Minister Beverley Hughes, said the difficulties in converting the historic buildings made Daedalus unsuitable for use as an asylum centre.

"I want our decision today to remove any uncertainty within the local community," she added.

Local opposition goups said the area was totally unsuitable for a centre housing up to 400 single male asylum-seekers.

Pointing to statistics suggesting up to 75% of successful asylum seekers would stay close to the centre, they said the area's infrastructure could not cope.

'Argument won'

The government denied that the decision marked a change in their policy towards accommodation centres, saying the plans for centres at Bicester, Oxfordshire, and RAF Newton in Nottinghamshire would go ahead.

John Beavis, chairman of the Daedalus Action Group, which coordinated the protests against the plan, told BBC News Online it was wonderful news.

"Common sense has prevailed," he said, "it was the wrong plan in the wrong place".

The centre closed in 1992

"We had support from Hampshire County Council, Gosport Council and our local MP, they all said it was the wrong place for an asylum centre."

"The Home Office said they would make the decision based on the based upon the suitability of the site and the salience of the arguments, and they've made the right decision."

Peter Viggers, Conservative MP for Gosport, agreed that the campaign had won the argument.

"Thousands of people were strongly opposed to the idea of putting 400 young men in a quiet seaside town like Lee-on-Solent," he told BBC News Online.

"It shows that if these centres should be built they should be small and in urban areas."

"These young men from places like Afganistan, Iraq and Turkey need to be housed in places where they can have some roots with their localities, which they clearly would not have in Lee-on-Solent."