North Lincolnshire Council have failed to reach an agreement with a local landowner for the facility at Gunness, which would be built just off the M181.
The authority will now consider alternative sites in the town - including Quibell Park and Central Park.
The site close to GP had been chosen after a public vote, with Scunthorpe United encouraging fans to opt for Gunness so it could be easily used for training.
Coun Alan Holgate, leader of the Council, told the Scunthorpe Telegraph: "The council remains committed to developing a sports academy.
"The sports council is vital if the council is to achieve its ambition of creating a modern leisure service for the people of Lincolnshire.
"We will now be considering the sites previously looked at, along with any others that could be suitable."