Pharmaceutical giant, Glaxo Smith Kline, has pulled out of building a new £350m biopharm drugs facility in Ulverston.
The decision throws doubt onto the future of the town's existing site, which could be sold by GSK.
South Lakeland District Council says it will work with GSK to find a buyer and to continue the operation of the facility.
GSK management says there will be no immediate impact on employees.
South Lakeland District Council says it is 'shocked and disappointed' at the announcement.