Eminem was due to play a "fast-rising welterweight boxer who brawls his way to the title, only to see his world crash down around him due to tragedy" in the film, to be directed by Training Day's Antoine Fuqua.
Southpaw was originally planned to begin filming in 2012, but DreamWorks has now dropped the production, according to MTV.
While no official reason has been confirmed, it is thought to be due to DreamWorks already having too many films featuring some form of boxing or fighting.
The film will now be pitched to other major studios, while Fuqua will remain attached as director of the project.
Eminem will return to the UK to headline this year's V Festival next weekend.
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