ACT Greens leader Jo Clay has announced the end of the party's confidence and supply agreement with Labor for the remainder of the term.
Ms Clay said the party was not considering forming government with the Liberals.
But she said the Greens would help pass the budget through the ACT Legislative Assembly.
The ACT Greens have ended their agreement to support the government on votes, citing a breakdown in negotiations over priority issues.
ACT Greens leader Jo Clay said the end of the agreement with Labor would apply for the remainder of the parliamentary term.
Ms Clay said the move was the decision of all four Greens MLAs as well as party members, who were consulted.
She said the ending of a formal relationship allowed the party to better hold ACT Labor to account, and that she had informed Chief Minister Andrew Barr of the decision earlier in the day.
While the party did not renew its coalition with Labor after the 2024 election, they did agree to the confidence and supply agreement, which helps the minority Labor government pass legislation through the ACT Legislative Assembly.
The end of their formal working agreement could leave the government in a perilous position, but it remains safe for now.
When long-term ACT Greens leader Shane Rattenbury retired earlier this year, the agreement was renegotiated, with the goal of renewing the relationship.
"This means measurable progress on public housing, stronger protections for renters, protecting the Western Edge, and properly resourced community services like our libraries."
Ms Clay said the government was going to have to be "very careful, issue by issue to work with everyone in parliament" from now on.
She said the party had set a "clear, fair bar" for the government but it had chosen "not to be accountable in delivering their own policy".
"As we've seen very recently, from the cancelled ice rink in Tuggeranong, to below-inflation pay offers for teachers, to cut library hours, the community is tired of good intentions with no follow-through."
But she said they would help the upcoming budget pass through the Assembly.
"We went in to negotiate on this budget earlier this year and we got some really key concessions in there. We made sure that the health levy would not be coming back, we made sure that we got a proper uplift in community sector funding," she said.
"This budget is not perfect, but this budget is a budget that the Greens will support passage of."
Ms Clay said the party was not considering forming government with the Liberals at this stage.
In a statement, Mr Barr said it was "disappointing" his party could not find a compromise with the Greens.
"We approached these discussions constructively and in good faith," he said.
"While we were unable to reach agreement on every issue, they were positive and productive conversations that identified substantial areas of common ground."
Mr Barr said there were some proposals from the Greens that Labor "simply could not support".
"That's not unusual when two separate political parties sit down to negotiate."
He rejected Ms Clay's assertion that the government was not delivering on its commitments.
"Labor is getting on with the job of building more homes, strengthening public services, supporting jobs and economic growth, advancing climate action and delivering on our commitments to Canberrans," he said.
"But we do so while also managing the many other requirements of the territory government."
A statement from ACT Labor said both parties had agreed to continue communicating and engaging regularly.
It said the end of that formal agreement would "not change the government's responsibility to govern for all Canberrans".
"The central question in many cases was not whether progress should occur, but how it should occur and how commitments could be delivered responsibly, sustainably and in a way that preserved the government's capacity to respond to changing circumstances."