Hungary's Olympic bid unravelled after a group of activists collected a 266,000 signature petition against the games. Momentum Movement, the organisers of the petition, say they wanted a referendum to be held on whether the games should be held.
"On the one hand we are happy and relieved because Budapest is not going to hold the Olympics," said Anna Orosz, one of the Momentum leaders. "But on the other hand we are sad because we think this decision should have been a democratic process in which we all decide on this question. The government has completely ignored the wish of 266,000 people."
Momentum shook the political firmament in Hungary by organising and collecting the names within the 30 day threshold. Budapest city council will vote on the bid's withdrawal on 2 March before formally telling the International Olympic Committee of the move.
Only Los Angeles and Paris are left in the race for the games. When the bidding process started, Rome, Boston and Hamburg were also in contention.
The move is a setback for the prime minister Viktor Orban. A sports enthusiast, the 53-year-old leader of the ruling Fidesz party was a key backer of the bid. It comes just months after low voter turnout voided his anti-migrant referendum aimed at rejecting a troubled European Union refugee quota plan.
"I work in sports ... but even if my heart was beating for the Hungarian Olympics, my mind said no," Eszter Balatoni, 37, told AFP. "There are so many other things that need financing in this country, like education and healthcare."
Several residents expressed frustration at the cancelled bid. "The majority of costs would have been paid by the IOC. These young liberals have destroyed the dreams of several million Hungarians," businessman Vilmos Lisztes, 47, told AFP.
The so-called "Nolimpia" drive had been aided by opposition parties critical of Orban.
Observers said Orban and Fidesz had no choice but to scrap the bid as the IOC hierarchy consider public support one of the key factors before anointing a host city.
"Momentum just showed up out of the blue," said Robert Laszlo, an analyst at Political Capital thinktank in Budapest. "These were young poeple who seemed to understand the voice of the people. They found a symbolic topic which was the Olympics and they showed that if you are involved and joined a movement you could stop the government from spending billions of euros on the games."
Laszlo added: "Momentum have pulled off a political coup in the past month and nobody expected this."