The SOLAS Big Boat Challenge was cancelled Tuesday after thick bushfire smoke sent visibility plummeting on Sydney Harbour.
Sydney to Hobart Race media director Di Pearson said the event had been called off because of safety concerns for both competitors and other vessels on the water in the reduced visibility.
"The smoke from all the fires is just so severe here on the harbour that you just can't see anything, so it's just too dangerous," she told AFP.
"The vision is just so poor."
Six large yachts had been due to line up for the race, which is a curtain-raiser for the biggest boats due to battle out line honours in the Sydney-Hobart open water classic which begins on December 26.
"There's obviously a lot of disappointment because it's a really big day on the water, it's a lot of fun, we get a lot of spectators both onshore and on the water," Pearson said.
She said two boats -- including 2019 Sydney-Hobart line honours winner Wild Oats XI -- had decided to sail out to train anyway as some of their crew had travelled from overseas for the event.
Pearson said everyone involved was thinking of firefighters battling more than 100 blazes across the country and Australians hit by bushfires, which have killed six people and razed more than 700 homes in recent months.
"Our thoughts ... are with the people who are suffering and losing their homes. This is a minor aberration compared to what a lot of people are going through right now."
It is the first time the SOLAS Big Boat Challenge, which was first held in 1994 and had been due to celebrate its 25th anniversary this year, has been cancelled.