The NBA's relocation committee has unanimously voted against moving the Sacramento Kings to Seattle.
The Maloofs had entered into a sale agreement with a Seattle-based group led by Chris Hansen and Steve Ballmer.
A full vote is still forthcoming, but the rest of the NBA's owners will likely follow the recommendation.
Seattle lost its NBA franchise to Oklahoma City in 2008.
The Maloofs will now be pressured to sell the franchise to a group led by Vivek Ranadive that will keep the Kings in Sacramento.