Cork city councillors narrowly voted against adopting a budget for 2015 following a five-hour meeting last night.
It is the first time since 1991 that the city councillors have failed to agree an overall budget.
Councillors now have two weeks to agree a budget before the council is dissolved and the Government appoints an administrator to run the city.
Councillors voted 15 to 14 against adopting next year's budget.
The budget contained proposals to maintain commercial rates at current levels and to keep parking charges at their current rates.
The meeting was told that the city council has lost €43m in Government grants since 2011.
Councillors also heard that the local authority has shed 367 jobs, saving €12m in payroll costs.
