The governor of California, Gavin Newsom, has blocked a landmark artificial intelligence, AI, safety bill, which had faced strong opposition from major technology companies.
The proposed legislation would have imposed some of the first regulations on AI in the US.
Newsom said the bill could stifle innovation and prompt AI developers to move out of the state.
Senator Scott Wiener, who authored the bill, said the veto allows companies to continue developing an extremely powerful technology without any government oversight.
The bill would have required the most advanced AI models to undergo safety testing.
It would have forced developers to ensure their technology included a so-called kill switch.
This would allow organisations to isolate and effectively switch off an AI system if it became a threat.
It would also have made official oversight compulsory for the development of so-called Frontier Models, or the most powerful AI systems.