Luna Rossa followed through with a threat to pull out of the 2017 America's Cup on Thursday and blasted decisions by the organisers that the Italian challenger called unprecedented and illegitimate.
Luna Rossa and Team New Zealand voted on Tuesday against reducing the size of the catamarans for the second time in less than a year.
However, both teams were overruled by a majority, led by two-time defending champions Oracle Team USA. The other challengers were Artemis Racing of Sweden, Ben Ainslie Racing of Britain and Team France.
The America's Cup class rules could only be changed by unanimous consent, but Oracle Team USA last week led an amendment to change the class rule to a majority vote.
Luna Rossa, backed by the fashion house Prada, said before the vote "it will be obliged to withdraw" if the rules were disrespected, and it was backed by Team New Zealand.
Luna Rossa have been one of the strongest challengers since 2000, when they reached the America's Cup match before being swept in five races by Team New Zealand.
"Following a careful evaluation of the serious implications of this unprecedented initiative, Team Luna Rossa confirms that it will withdraw from the 35th America's Cup," a team statement said.
"Team Luna Rossa indeed considers illegitimate the procedure adopted and founded on an evident abuse of process by surreptitious use of procedures to modify the protocol in order to overturn the class rule, which instead requires the unanimity of the teams entered."
The 2013 America's Cup in San Francisco was raced in 72-foot (22-metre) cats. Last June, the teams unanimously agreed to reduce the boats to 62 feet (19 metres). Now, the boats are down to 48 feet (14 1/2 metres) for the 2017 regatta in Bermuda.
"Today is a sad day for the America's Cup," Oracle rivals Alinghi said.
"Luna Rossa are a team of passion, skill and determination - all the qualities needed in this great competition. They inspired us to compete in 2000, and to win. The cup is diminished without you, our friends."
While the downsizing was considered a major cost-cutting move, Luna Rossa were believed to be at an advanced stage in development of a larger boat.
"This radical change also implies a waste of important resources already invested based on the rules that were sanctioned in June last year," Luna Rossa said.
It's not the first time Luna Rossa team principal Patrizio Bertelli, who is married to Miuccia Prada, has followed through on a threat.
In July 2013, they sat out the opening race of the challenger trials on San Francisco Bay to protest rules changes, leaving organisers with the embarrassing scenario of Team New Zealand sailing around the course alone.
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