Music
The 'Smile' singer was due to perform with rappers Kanye West and Common on the September 9 ceremony and has been nominated for the Best New Artist award.
She was banned from the States last month after she turned up to Los Angeles airport and had her visa revoked in connection with a clash with a photographer in London earlier this year.
A source said: "MTV were desperate to get Lily and they're furious with her visa situation. They've decided to pull the plug because they didn't want to leave it to the last minute to find out if she could or couldn't make it."
Allen has hired top law firm Sheridans to fight her case and said: "I am trying everything I can to sort this out. I don't like letting my fans down.
"It is my intention to play my American dates in September. This depends of the authorities granting me a new work visa."
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