Waikato-Tainui says it can't offer financial support to the Maori Council's water rights legal action against the Crown.
The council has been seeking help to fund its High Court case, but Waikato-Tainui says its spending is constrained by its charitable status.
The executive of Waikato-Tainui - Te Arataura - says its commitment is to continuing dialogue with the Government over Maori water rights and interests.
Chairman Tom Roa says the Iwi Chairs Forum and the Maori Council are taking different routes to achieve the same result.
The Maori Council is waiting for the High Court to make a ruling following a judicial review of the Crown's plan to sell shares in state-owned hydro-power stations.