COUNCILLORS say they will press ahead with controversial bypass plans after the Western route was knocked back by an independent inspector.
The £55 million scheme has been rejected by Government inspectors examining the city council's Local Plan.
A 1995 investigation into the Lancashire Structure Plan also ruled it out.
Earlier this year, county council transport chiefs made the bypass its number one priority.
And local councillors from three of the five main parties say they will plough ahead despite the report.
The city's Green group welcomed the decision in a statement which read: "It is high time that the city and county councils realised that the supposed economic and traffic benefits of this road do not stand up to proper scrutiny.
"Instead of wasting time trying to build a road that won't be given funding, they should be taking action to reduce traffic and investing money directly into creating worthwhile and sustainable jobs."
However, Morecambe Bay Independent leader, Cllr Tricia Heath, called for the bypass to be given the go ahead as quickly as possible.
She said: "The news that the western route has been rejected in the local plan could be disastrous for the area.
"We, together with local people, have to shout even louder to make our case heard. This district must have this link. The fight is far from over."
Labour County Councillor Richard Toon, chairman of the county's highway's committee, claimed the Inspector's report gave no reason why the link road should not go ahead amd pledged to consider the contents carefully and hold discussions with the city council.
"We feel, however, that the Inspector has not said anything that means that a new link from Heysham to the M6 will not become a reality," he commented.
His remarks were backed by Labour city and county councillors. Liberal Democrat Pat Quinton, who represents the County Council ward through which the road would have passed, welcomed the decision.
She called for the cheaper Northern Bypass option to be explored.
She said: "I understand it is clear in the report that if a Northern route for the M6 Heysham link road had been included it would have been accepted by the Inspector."
Conservative group leader James Airey also suggested that alternative routes could be looked at.
He described the Inspector's decision as 'dreadful' but added: "I think there is a case for looking at another route. The Western bypass is certainly the one that would cause the most environmental damage."
The council now has eight weeks to examine the report and suggest amendments and modifications, which must be supported by a reasoned argument.
A final decision on the Local Plan will be made by councillors and is expected before the end of the year.
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