Tech giant Google has pulled out of plans to base its headquarters at a repurposed White Bay power station in Sydney's inner west, delivering a major blow to the state government's aim to convert the area into a technology hub.

The failure to provide public transport upgrades to the Bays Precinct in Rozelle was cited as a reason for Google's decision to withdraw from negotiations.

"Ultimately, the complexity of the project and the timing of associated transport infrastructure could not meet Google's requirements at this time," the NSW government said on Tuesday.

A Google spokesman said the company had "mutually agreed" with government developer UrbanGrowth NSW to abandon talks of relocating its operations from Pyrmont to Rozelle, but said it remained committed to finding "an alternative long-term home here in Sydney".