Thousands of people attended the event last year, as it made a successful return following the Covid-19 pandemic.
And this year's event was scheduled to take place at Meggie’s Burn, Blyth, from Friday, August 26, to Sunday, August 28, attracting up to 10,000 people across the three days, with events also planned in nearby Ridley Park.
It was scheduled to be headlined by Whitley Bay-born electropop rebel L Devine and sponsored by Jaccountancy.
Also set to perform were cult sensation in London’s underground music scene Lynx, UK pop songstress Channy alongside over 40 other local and national performers.
A spokesperson said: “Northumberland Pride have taken the difficult decision to cancel the Northumberland Pride Festival 2022.
"Instead, we will now deliver several exciting smaller community-based events to celebrate pride in 2022.
“As one of few prides that delivered a successful event in 2021, we know there will be disappointment to our LGBTQ+ community, allies, stakeholders, and the wider community who have supported the festival since its inception in 2018.
“Our decision to cancel rests on unsustainable cost rises including an oversaturated market.
"Despite working around the clock to bring a local and diverse festival, 2022 is not the time for our festival to expand further and build on previous year’s successes.
“It is important for Northumberland Pride to protect its vital all year-round services which are a lifeline of support to LGBTQ+ communities across the county and beyond.
“In 2022, we will focus on delivering quality localised community events that meet the needs of LGBTQ+ people and our allies across Northumberland and beyond.
“Ticket holders and organisations should visit www.northumberlandpride.org.uk/festival to find out more from May 9.
“We extend our gratitude to our teams, artists, partners, staff and volunteers who work so hard throughout the year.
"Thank you for your continued support.”
Pride events are planned in Durham, Sunderland, Newcastle and Darlington.
The Northumberland Pride Festival was due to be the fourth one held while the work of the Pride organisation aims to restore vital visibility to Lesbian, Gay, Bisexual and Transgender Plus (LGBT+) communities.