Victoria's premier queer festival has cut its sponsorship deal with News Corp amid a community backlash over "homophobic" reporting by Rupert Murdoch's media empire.

The decision means News Corp will be banned from next month's Pride March in Melbourne, while Midsumma organisers have also pulled all advertising from the Herald Sun.

Couples say "I do" at the 2016 Midsumma Carnival. Credit:Meredith O'Shea

Organisers of Midsumma slashed the News Corp deal in the wake of a number of cartoons, news stories and opinion pieces that have vilified the LGBTIQ community over the past six months, and in particular targeted marriage-equality activists and the Safe Schools program.

Concerns about the sponsorship were first raised by gay and lesbian community radio station Joy 94.9 in the wake of a cartoon by The Australian's Bill Leak that compared gay people to Nazis.