National Tenant Voice was told this week by housing minister Grant Shapps that its funding will be withdrawn.
Set up by the Labour government in April this year with a budget of more than £1m, NTV was made up of 50 unpaid tenant representatives and a 15-member board, nine of which were tenants.
A spokesman for the Department for Communities and Local Government said the organisation was "too distant" and represented poor value for money.
He added that Shapps had asked NTV chair Michael Gelling to consult members of the organisation on how some elements of its operations could continue.
"The best way to ensure tenants have a more influential role over the services they receive is by putting more power and voice directly into their hands", the spokesman said.