A controversial $70 million resort proposed for the small coastal town of Apollo Bay will not be built after the Andrews government intervened, halting the imposing development overlooking the Great Ocean Road.

Planning Minister Richard Wynne has refused to approve a planning permit for five-star accommodation that was set to become the largest and most visibly prominent development in the rural area less than three hours' drive from Melbourne.

The proposed development, which was to include 180 new hotel rooms and 82 villas.

Mr Wynne's move follows objections by almost all residents in the seaside town.

The resort proposed by Oceans United Investment Group would have included 180 new hotel rooms, 82 villas, two restaurants, a 'wellness centre' and pool.