Invercargill City Council group manager infrastructure Erin Moogan said the decision was made at a recent meeting because the lights were now past their use-by date.
"The current decorations are beginning to deteriorate and are reaching the end of their life," she said.
The council provided the community with Christmas trees, shimmer panels in Esk St and a range of festive flags and banners, Moogan noted.
Mayor Nobby Clark said the decision was based on keeping rates down as he aimed for increases to stay close to the rate of inflation.
"To help keep the next rate increase low, from next year, I intend to encourage retailers and business owners in the CBD to do up their shop fronts with a Christmas theme," Clark said.
"By reducing our expenditure, I believe we can reduce our rates increase in the future."
Those wanting to enjoy Christmas lights in the city won’t be completely out of luck moving forward.
A guide for locating houses lit up for the festive season is produced annually, sponsored by local businesses.
LDR is local body journalism co-funded by RNZ and NZ On Air