Parish councillors have refused to sanction the use of council tax money to turn a redundant bank into a village museum.
Villagers trying to raise nearly £350,000 for the scheme went to a meeting of Lindfield Parish Council to outline their scheme.
The museum group has some money pledged but is well short of its huge target.
The Lindfield residents appealed to Barclays to show a "social conscience" earlier this year by supporting a new scheme for the site.
The bank shut its branch in High Street, Lindfield, in April as part of a cost-cutting programme brought on by moves towards telephone and internet banking.
Some villagers want to turn the building into an archive and museum telling the village's history. Tourist information and other services, including a cashpoint, could also be provided.
But after hearing the villagers' case at a special meeting at the King Edward Hall in Lindfield on Monday. parish councillors declined to back it with public money.
No specific amount of money was requested, but councillors ruled out any contribution.
Parish council clerk Sue Kolien said: "Individually, councillors are fully supportive of the scheme. But as far as the parish council is concerned, they did not feel they could put any money into it."
The museum group is hoping late talks with Barclays might bring some success in fixing up some funding.
Every household in Lindfield received a letter from campaigners asking for support.
The campaign's six-strong committee was given until last Friday by Barclays, which has had other offers for the building, to prove that a community purchase was viable.
The "Bank House" is described as a classic Wealden building of medieval origin, situated in the heart of the village.
Donations, loans and expected income from a cafe were considered as part of the scheme's financial plan.
The museum group is still hopeful that last-minute talks with Barclays may lead to an extension of the deadline.
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