In a plebiscite held Monday, 188 residents chose not to support the proposal while 175 were in favour of permitting limited amounts of alcohol.
A 60-per-cent majority would have been required to effect change.
Residents were asked whether they wanted to allow community members to acquire up to one litre of spirits, four litres of wine and 11 litres of beer every 14 days.
Voter turnout was 49 per cent.
Possessing and purchasing liquor in Gjoa Haven will consequently remain illegal.