Supporters of Green Party presidential candidate Jill Stein on Saturday withdrew a last-ditch lawsuit in Pennsylvania state court aimed at forcing a statewide ballot recount, another major setback in the effort to verify the votes in three states that provided President-elect Donald Trump his margin of victory.

Ms. Stein’s campaign announced in a statement Saturday that the Pennsylvania lawsuit had been dropped after the court demanded that a $1 million bond be posted by the 100 Pennsylvania residents who brought the suit, which was backed by the campaign.

Recounts will still proceed in a handful of Pennsylvania precincts, but it is far from the statewide recount that Ms. Stein initially was hoping for. Her campaign is considering a lawsuit at the federal level that could revive the hope of a statewide recount next week, with an announcement expected on Monday.

She is also pushing recounts in Wisconsin and Michigan after a prominent computer scientist laid out a case that the election results could have been hacked. Legal challenges have also been filed in state and federal court to halt those recount efforts as well.

The decision also dashes the aspirations of some Democrats, who had hoped that enough irregularities or missing votes would be found across all three states to overturn the election results that saw Mr. Trump, the Republican candidate, prevail over Democrat Hillary Clinton. Mrs. Clinton would need to declared the winner in all three states to reverse the election results.

“The judge’s outrageous demand that voters pay such an exorbitant figure is a shameful, unacceptable barrier to democratic participation,” said Ms. Stein in the statement. “This is yet another sign that Pennsylvania’s antiquated election law is stacked against voters. By demanding a $1 million bond from voters yesterday, the court made clear it has no interest in giving a fair hearing to these voters’ legitimate concerns over the accuracy, security and fairness of an election tainted by suspicion.”

In a statement, the Pennsylvania Republican Party said the election “produced a clear winner, Donald Trump, and the actions of Ms. Stein and her supporters to create the fear of chaos by making baseless accusations of the hacking of voting machines in Pennsylvania were an insult to all Pennsylvania voters.”

Ms. Stein said she would be making an announcement regarding the future of her push for a Pennsylvania recount on Monday in front of Trump Tower in New York. In a statement Saturday night, Ms. Stein’s campaign said she was considering legal options in federal court.

President-elect Donald Trump addressed a crowd in Cincinnati on Thursday during his ‘USA Thank You’ tour. Mr. Trump won the state of Pennsylvania on Election Day as part of his victory tally. Photo: Evan Vucci/Associated Press

After an initial flurry of fundraising, Ms. Stein now appears to be falling short of her fundraising goal of raising $9.5 million to fund the recount efforts in three states. A fundraising page set up by her campaign shows that she has raised roughly $7 million as of Saturday evening.

A federal court is also considering a request to halt the recount in Wisconsin, while Michigan’s Republican Attorney General filed suit in state court on Friday to stop the recount there. All three states face a December 13 federal deadline to resolve any disputes over the results.

The election results are set to be finalized on December 19, with a vote of the Electoral College.

Write to Byron Tau at byron.tau@wsj.com