Lille mayor Martine Aubry said that the decision to cancel this year's Grande Braderie was taken as there were security risks that cannot be reduced.
The fair, which features 100 km of stalls and hosts 10,000 exhibitors, is one of the most popular events in Europe. Last year, it attracted around 2.5 million visitors.
This is the latest of a number of traditional and cultural events that have been cancelled in France following the Bastille Day attack in Nice and the murder of a priest.
Nice's annual Prom'Party which is held during the second half of August on Promenade des Anglais has been cancelled. Grasse has decided to forgo its 70th jasmine festival which was to be held this weekend.
The town of Avignon has scrapped a fireworks show set for August 25, the anniversary of its liberation in World War II.
Marseille cancelled its August 15 fireworks and as well as the August 13 air show that was to have been attended by 100,000 people. A night of stargazing at the Marseille Observatory, set for tonight, has also been called off.
In Paris, open-air film screenings have been moved indoors.
Defence Minister Jean-Yves Le Drian said the cancellations were warranted because of the “war situation” arising from the string of jihadist attacks to hit France in the last 18 months.
“Everyone must understand that we are in this situation and that sometimes that entails constraints,” he said.