A planning bid for the Lower Thames Crossing has been withdrawn while highways bosses have a rethink.
The decision to pull the application was made today and is said to be based on early feedback from the government's planning arm.
Highways England, which is behind the proposal for the tunnel between Kent and Thurrock in Essex, said it would resubmit the plans early next year.
It added this would be done after it had time to collate the information required to address "specific points".
The 16-metre wide tunnels have been dubbed Britain’s most ambitious roads project in a generation.
The Lower Thames Crossing has been designated as a Nationally Significant Infrastructure Project (NSIP), which are large, complex infrastructure projects which require the consent of the government.
To get permission to build, highways bosses must seek consent through a special process and be awarded a Development Consent Order (DCO) from the government's planning arm, the Planning Inspectorate.
Last week, bidding opened for contractors to build the new tunnel, which at £2 billion is said to be one of the largest contracts ever put out for tender.
But the scheme has also been met with opposition over claims of a ‘flawed’ consultation process.
A Highways England spokesman said: "We’ve withdrawn the Development Consent Order application for the Lower Thames Crossing based on early feedback we’ve had from the Planning Inspectorate.
"We will take time to collate the information required for the specific points raised and will be resubmitting the application early in the new year."
Reacting to the announcement, Dartford council leader Jeremy Kite said he was disappointed to see plans temporarily shelved but does not believe it will affect the project's progression.
"It has had a massive consultation response – I don't think there is any problem with the principle of the application but more the details," he said.
"My understanding is it relates to detail within some of the local consultation responses."
The Tory leader reiterated the project's size and complexity and said it showed the process works, and that local people's voices were being heard.
"This proves the system is working," he said. "It is very important that if someone has raised concerns, whether it is an individual, group or otherwise that the application addresses it."
Cllr Kite added he was confident the project would go ahead as planned and that the build date afforded the relevant developers flexibility in this regard.
Gravesham councillor Bob Lane is member for Shorne, Cobham and Luddesdown Ward, which would be most affected, and spokesman for the campaign group Abridge2far. He has been heavily involved in pressing for changes to the scheme since 2013.
He said: "It is obvious that Highways England were given the option of withdrawing their application or having it thrown out, and they are trying to save face by pulling it rather than have it rejected.
"This is typical of the flawed and shambolic way they have conducted this from the start, but perhaps the first time they have had to listen to advice.
"No doubt the Planning Inspectorate has told them where their application falls short, and they will now be desperately trying to address some of the weaknesses in their application before resubmitting it at some time in the future.
"In the meantime, no doubt they will continue with their preliminary works on site as though they have already been granted permission.
"Residents whose lives have been blighted by this project should not be under any illusion that the project itself has been withdrawn, but we can only hope that at some time in the future the Planning Inspectorate will throw the whole project out and force Highways England to reconsider their plans."
Gravesham council and Thurrock Council put out a joint statement, saying they had "fundamental concerns" over the public consultation process.
The statement said: "The Lower Thames Crossing is one of the largest transport infrastructure projects we will see in our lifetimes.
"While we are yet to understand the full reasons behind the withdrawal or what feedback Highways England has received from the Planning Inspectorate, the impact a project of this scale will have on our communities means it is only right that as much time as necessary is taken to ensure every last detail of the project is understood and has been assessed thoroughly.
"Together we had fundamental concerns over the adequacy of the public consultation conducted by the Highways England.
"While it will impact Gravesham and Thurrock in different and specific ways, we feel the overall impact on our local communities will be such that full, genuine and meaningful consultation on the proposals is an absolute minimum requirement if we are to ensure the views of the people we represent are fully taken into account.
"It remains to be seen whether that is a view shared by the Planning Inspectorate and therefore is a contributing factor to the withdrawal of the DCO application.
"We urge Highways England to take this opportunity to bring forward improvements to this scheme that will be for the benefit of all those who live in our boroughs.
"We await further information with interest."
Cllr John Burden, Leader of Gravesham council, said: "This can only be good news. It suggests the Planning Inspectorate has found fundamental issues with the DCO.
"We have said all along that while we remain opposed to the project, we reluctantly and unfortunately accept the Lower Thames Crossing will go ahead.
"But we are determined it will go ahead with the best interests of the whole community of Gravesham, but specifically those closest to it and whose lives will be impacted the most by it, at its heart.
"This delay gives us the chance to drive that point home to Highways England with even greater force."
Cllr Rob Gledhill, leader of Thurrock Council, said: "I am pleased to see that that Highways England are responding to issues raised by the local authorities where this new proposed Lower crossing will have a huge impact.
"We will continue to work along with our partners to engage with Highways England and to secure the best outcome for our residents in Thurrock."