The Insider, which was staged in the Cairngorms National Park, had been an annual fixture since 2009.
More than 50 acts appeared annually at the boutique-style event, near Aviemore, with previous line-ups including Rachel Sermanni and Karine Polwart, The Phantom Band, Washington Irving, Admiral Fallow and Lau.
Its organisers said they had postponed this year’s event to take stock of its future - although they pledged it would be back in 2015 in some form.
The shelving of The Insider, which was staged on a picturesque site on the banks of the River Spey, has been confirmed just days after it emerged Fife’s biggest event, the Big Tent Festival, had been shelved indefinitely.
The Insider, which had a capacity of just 750 and bands performing across four stages. had attracted a cult following to the grounds of Inshriach House, an Edwardian country House, from all across Scotland.
It is traditionally staged at the end of June and if it had gone ahead this year it would have clashed with a one-off festival being staged to mark the 700th anniversary of the Battle of Bannockburn.
Two of Scotland’s biggest festivals, T in the Park and Rockness, were both left with thousands of extra tickets last year.
The Insider had been set up at short notice in 2009 following the demise of the ill-fated Outsider Festival, a heavily subsidised event staged as part of the Year of Highland Culture in 2007.
A repeat was planned for the Year of Homecoming in 2009, but the event was axed with several months to go due to poor ticket sales.
Polly Cameron, co-director of The Insider, said: “We’re just taking a bit of a breather this year.
“We’re going to carry out a full assessment of the kind of direction we want to take the event in.
“It’s not really down to the number of events that are on this year, that wasn’t a factor in our decision. But we are definitely planning to stage the festival in 2015.”
The Scotsman revealed earlier this week that the Big Tent Festival, the biggest eco-festival in the country, had been cancelled after organisers admitted they had struggled to handle its swift growth. The Proclaimers, King Creosote and Rosanne Cash had been among its major draws.
It was launched by the Falkland Centre for Stewardship in response to the staging of the G8 summit at Gleneagles, and quickly grew to attract more than 11,000 festival-goers. However staff at the centre said the event had been a victim of its own success and that they had decided to focus on staging a string of smaller-scale events throughout the year.