Maidstone United is having to revise its redevelopment plans after Maidstone council refused to sell it a two-metre wide strip of scrubland.
The club wants to develop the west side of Gallagher Stadium, and had hoped to buy the land, which sits between the stadium and a path leading to Whatman Park.
However, the council only wants to lease the plot for 99 years for a peppercorn rent.
The stadium in James Whatman Way has a capacity of 4,200, but needs to extend to increase to the 5,000 required by the Football League.
Club co-owner Terry Casey described the decision as a big disappointment after a year of negotiations and called on the council to reconsider.
He said: “The football club went to great lengths to offer a fair market price but Maidstone Borough Council, despite agreeing the land is surplus to requirements, insisted they would only offer a lease agreement, as they deemed the strip to be ‘strategic’ and wanted to retain control.
“If we were to agree to a lease we would always be at the mercy of the council and it would make it impossible to raise financing for the future.
“We don’t feel this is a fair and reasonable position for the club to be put into.
“It is deeply disappointing in terms of trust and support that the officers said they disagreed with our arguments.”
The Gallagher Stadium opened in 2012 at the cost
of £2.8 million – with owners investing a further £5 million
Speaking at the council meeting, Cllr David Pickett, chairman of the heritage, culture and leisure committee, said: “I think there’s no dispute that we are really supporting our local football club.
“We are very lucky to have such quality and in the town centre which is good and it’s very good for the economy.”