The cruise ship, Tahitian Princess, will stop sailing the waters of French Polynesian before the end of the year, provoking further losses to a struggling tourism sector.
Local radio reports say the ship will leave for Asia and as yet no replacement has been found.
The vessel is said to bring in about 20,000 tourists a year, with a value of about 50 million US dollars to the local economy and the territory's airline.
The departure is seen as one of the consequences of the decline in the value of the US dollar as well as the instability and disruptions by industrial action in Tahiti.
The announcement comes as arrival figures for the first three months of this year were down nearly ten percent of those recorded in the same period in 2007.
