The program had drawn criticism from groups claiming it risked fostering prejudice.
In a statement Wednesday, ABC acknowledged the delicate nature of the series in which families asked to pick a new neighbor are made to expose and overcome their biases.
"Welcome to the Neighborhood" demonstrates what happens when people are forced to "confront preconceived notions of what makes a good neighbor," the network said.
"However, the fact that true change only happens over time made the episodic nature of this series challenging, and given the sensitivity of the subject matter in early episodes we have decided not to air the series at this time."
The six-episode show, which was to debut July 10, follows three families in Austin, Texas, who are given the chance to choose a new neighbor for a house on their street.