The New South Wales Eventing State Championships have been called off after the Hunter Valley competition ground was deemed unsafe because of extremely dry conditions.
The Scone horse trials were meant to run for two days in March.
The competition is also the Eventing State Championships.
But the course is cracked, bone dry and hard under foot.
A teenage rider Olivia Inglis died while competing at the event two years ago.
Horse Trials president Blair Richardson said safety was paramount, and that the weather forced the committee's hand.
"You know when you're at the venue and you look around and water is a big issue, we have to take into consideration the welfare of the horse," he said.
"The ground is hard and it is a hot time of year and to not have any good water supply is our main issue."
Hundreds of riders were due to compete in the event.
Mr Richardson said the committee was duty bound to put safety first.
"There was basically no choice and the decision has been made for us really," he said.
"Unfortunately we can't control the weather and as you know the Hunter Valley is in a bad way at the moment in relation to drought and this is just one decision we've had to make in relation to it."
Olympian says 'wicked' drought a nightmare
The annual Scone event is held at the property 'Broomfield', near Gundy.
Even in good conditions competitors are urged to use water sparingly as supplies are limited.
But now those scarce supplies have completely dried up.
Australian equestrian Olympian Heath Ryan said the cancellation was heartbreaking, but understandable.
He said the hard ground posed too much of a risk to horse and rider.
"It'll be rock hard when it's dry like that and that sort of introduces concussion in the horses' legs," he said.
"When we have no rain like this it is a nightmare for us … it is a wicked thing to happen to the sport."
Mr Ryan said he had never seen conditions so bad.
"The farmers are just being annihilated really. It is so dry … and I have never seen it like that."
The Scone event is an international one, seen as a key qualifier for Australia's top riders trying to win a spot on the Olympic team.
Mr Ryan said the timing was unfortunate, as riders try to gain national selection for global events.
"This year is the world equestrian games in North Carolina," he said.
"Scone is part of that preparation and the trialling and the selection process where you can get picked on an Australian team.
"To have it go out is more significant than anyone can actually believe."
Organisers of the Scone event said they would be working with landowners and the group Eventing New South Wales to find a suitable date later in the year.
