AFL Victoria has opted not to continue North Ballarat's VFL license, meaning they will not have a VFL team in 2018.
The news was confirmed on Thursday afternoon.
AFL Victoria CEO Steven Reaper said they were not convinced it was sustainable.
“After significant upheaval at board level in recent years at North Ballarat, AFL Victoria believes the current position the club finds itself from both a governance and on-field perspective doesn’t meet the key criteria needed for a continuation of the club’s VFL licence,” he said.
“AFL Victoria needs to ensure there is a sustainable team in Ballarat, and one that is representative of the region and is fully focussed on a state-league presence."
North Ballarat has seen AFL players such as Tony Lockett, Isaac Smith, Darren Jolly, Ricky Henderson, Michael Jamison and Dean Towers progress through the ranks.
Reaper said the club's review indicated issues within the club.
“A recent football review at the club indicated issues with the current governance structure in place to support the VFL program given it also had a focus at community level with North City playing in the local Ballarat competition," he said.
“When combined with the identified need to also restructure the on-field program, AFL Victoria believes that all of the proposed changes would take significant time to effectively implement and feels that the club would be better placed to focus on making these changes before again considering a VFL presence.”
Reaper said the situation around Frankston, who lost and then regained their VFL licence in a 12-month window, could see the rejuvenation of North Ballarat.
“We have been able to learn from the situation with Frankston over the last year, that time out of the competition does not mean a team is lost forever," he said.
“With all parties working together, a quick return could be seen for a Ballarat entity in the VFL.”