Andy Street has confirmed he will not resign over the scrapping of HS2, announced by Rishi Sunak this afternoon.
He had threatened to resign after the speech if the PM confirmed the cancellation of the northern leg.
Speaking ahead of the speech, a source close to Street said: "He is very disappointed. "He wants to see what today brings but it is certainly possible that he will resign immediately after the Prime Minister’s speech."
But in a statement posted to X this afternoon, he said he "thought incredibly long and hard about what my future in the Conservative Party should be."
A spokesperson for the mayor said: "We intend to listen to the prime minister’s speech and respond accordingly.”
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Street added: "Ultimately, I have decided not to resign".
The Mayor of the West Midlands continued: "I know this decision will make me deeply unpopular in some circles, and indeed many wanted me to resign and make a statement against my party.
"But i have always said that I would put place before party, and staying as a Conservative to work with the Prime Minister and his Government to continue the revival of the West Midlands is doing exactly that."
In his conference speech, Sunak said: "I am cancelling the rest of the HS2 project and in its place we will reinvest every single penny…£36 billion pounds in hundreds of new transport projects in the North and the Midlands, and across the country."
There will still be a line running between the two cities, but instead of building a new high-speed track it will use existing West Coast Mainline tracks.
Street previously warned that axing the high-speed rail link would amount to “cancelling the future”.
He has held regular meetings with Rishi Sunak over the last few weeks as part of an attempt to salvage the plans.
Speaking on Tuesday, the West Midlands Mayor said: "The Prime Minister and I spoke last week about the difficulty, and I understand his difficulty and I said I would help him find a solution."
Hitting out at the plans, Labour Mayor for Manchester Andy Burnham said: "So, in other words, HS2 won't go to Manchester and people in the North will be treated as second-class citizens - again?
"What a disgrace."
Speaking later at an event near the Conservative Party Conference in Manchester, Burnham said 40 businesses had written to the Prime Minister on Tuesday to demand he not scrap the line.
The mayor said: "If you think about that for a moment, you know that will be a permanent statement for people in the north of England that they are second-class citizens when it comes to transport infrastructure.
"It beggars belief in some ways that they are going to do this, they are going to pull the plug on that infrastructure that would pave the way for that new east-west line across the north, promised in not one, not two, but three Conservative manifestos.
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Burnham said 40 businesses had written to the Prime Minister on Tuesday to demand he not scrap the line
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"But to pull that plug here in Manchester would show complete contempt to the city region and to the north of England as a whole."
Burnham told the audience: "We say to them tonight: it isn't too late from our point of view, you could invite us in. Do not pull the plug on this city while you are in this city.
"If you do do those things, people here will never forget."