Canada, backed by the EU, the United States and Mexico, had pushed for the recognition of LGBT people.
Canada, backed by the European Union, the United States and Mexico, had pushed for including the recognition of LGBT people and an acknowledgment of homophobia in a key policy paper to be finalised at a major UN conference in Ecuador next week.
The UN's 'New Urban Agenda' is a non-binding agreement to address the challenges of rapidly growing cities globally and will be adopted at Habitat III in Quito, setting out guidelines for sustainable urban development over the next 20 years.
The recognition of LGBT communities and an acknowledgment of homophobia would be seen as a significant step by the United Nations with same sex relationships illegal in 76 countries around the world and punishable by death in seven.
But sources said a behind-the-scenes campaign by Belarus, supported by various nations including Russia, Egypt, Qatar, Indonesia, Pakistan and the United Arab Emirates, had resulted in the document only referring to cities being "friendly for families".
Josh Bueckert, a spokesman for the Canadian government, said Canada "fought hard" to have gay rights and homophobia officially recognized and insisted throughout negotiations that the "most vulnerable and disadvantaged" be kept in mind.
"We are not able to speak to the positions of other countries on the negotiation of the declaration for the New Urban Agenda ... unfortunately the LGBTQ2 community was left out," Bueckert told the Thomson Reuters Foundation.
A "Call for Action" section in the paper recognizes the special vulnerabilities and discrimination of specific groups in cities with the list including women and girls, the disabled, indigenous people, the homeless, slum dwellers, refugees and youth - but makes no mention of LGBT people.