Civil servant Jim Spooner of the Department of Transport wrote to members of the Bike Week Liaison Group telling them of the transport minister's decision.
The letter said that John Spellar had reached the grant withdrawal decision after taking advice from the National Cycling Strategy Board, chaired by ex-transport minister Steven Norris.
Spooner wrote "whilst Bike Week provides invaluable cycling promotion, it ought to be self-financing."
A glimmer of hope was offered when Spooner said funding could be restored if "it should form part of a wider strategy for the marketing of cycling, currently being developed by the NCS board."
But all hopes were then dashed, when he finished his letter by hoping that the minister's decision "will provide sufficient time for the Group to identify alternative sources of funding should it decide to continue with Bike Week."
Bike Week 2002 saw 2070 events taking place around the country, including family rides, free cycle safety checks, commuter challenges, bike-to-work days, and charity fundraising rides.
National Bike Week used to be free of government support but was rescued by the Department of Transport in 2001 following the collapse of a commercial sponsorship package.