The deal would have reunited the media empire Murdoch split nearly a decade ago.
But News Corp said in a statement on Tuesday that the tie-up was: "not optimal for shareholders of News Corp and Fox at this time."
According to sources, the merger was pitched as a way to greater scale news, live sports and information.
Several people close to the Murdochs viewed the effort as driven by the 91-year-old's succession planning....
to consolidate power behind his son and Fox head Lachlan Murdoch.
A notion the company described as "absurd" in November.
Activist investment firm Irenic Capital, which was among the first to say that the proposed reunion would likely undervalue News Corp, on Tuesday applauded the decision to not move forward.
In addition to scrapping the planned merger, News Corp is exploring a sale of Move, the company which operates the property website realtor.com.
Three sources familiar with the matter said News Corp was in talks with CoStar to sell its stake for about $3 billion.
News Corp agreed to buy Move in 2014 for $950 million to diversify its digital real estate business.
