West Dunbartonshire Council proposed plans to build a new £21million school campus on Posties Park in Dumbarton.
But the council's education committee rejected the scheme for the new Our Lady and St Patrick's High School and asked officers to investigate other potential sites.
Councillor Michelle McGinty, Convener of Educational Services, said: "We agree with council officers that the Posties Park site is the best option available in Dumbarton on educational and construction grounds.
"However, we take decisions on behalf of the people of West Dunbartonshire and had to acknowledge the lack of support for the building of the school on Posties Park, as well as the strong public desire to retain the open space."
Rose Harvie, Secretary of Silverton and Overtoun Community Council, said: "We are ecstatic. We are extremely pleased and extremely grateful to the committee for their decision.
"We fully appreciate it's not an easier decision to make and it takes courage to admit you have made a mistake."
Education bosses were given two options: keeping the existing school site in Castlehill and Posties Park.
But they agreed both sites had too many drawbacks to proceed.
Officers have now been tasked with revisiting all alternative sites in council ownership and exploring what private sites might be available.
To reassure parents, the committee reaffirmed its determination to build a new school for Our Lady and Saint Patrick's.
Ms McGinty added: "Regrettably the current school site has also proved unsuitable.
"The full exploration of that site showed that it was extremely restrictive and would be difficult to develop safely without major disruption to pupils educational experience.
"A completed school on this site would also be an inferior establishment relative to the other new build secondary schools in West Dunbartonshire.
"We thank officers for their professional work to date on this project, and look forward to hearing the results of their new investigations into possible council and private sites."
Councillor John Mooney, Depute Convener of Educational Services, said: "We are all sad to delay the construction of the new Our Lady and St Patrick's High School but it is important that we settle on a site that is educationally suitable and has the support of the local community."