Plans for a major housing project in Kingsteignton have been thrown out by a government minister.
The bid for 600 new homes at Newcross had been submitted by WBB Minerals, now known as Sibelco.
The scheme was rejected by Teignbridge Council in January but WBBM appealed the decision and a public inquiry followed.
Now the Secretary of State for Communities, Hazel Blears MP, has said the scheme was flawed.
It offered too few affordable homes and a new school should have been included.
However, a linked bid to develop a sports complex at nearby Broadway, also turned down by Teignbridge, has been approved.
The news coincides with an appeal for the public to nominate development sites for up to 19,000 new homes across the district.