The Ministry of Education had planned to start teaching English to 10-year-olds in the coming academic year. It had already taken on 300 extra Saudi teachers and recruited another 200 teachers from Egypt and Bangladesh.
But Crown Prince Abdullah bin Abdul Aziz now says the plan needs "further deliberate and deep studies" by the Committee for Educational Policy before it can be implemented, effectively kicking it into the long grass.
The decision represents a huge setback for modernisers at the ministry seeking to reform the curriculum.
At present state school pupils learn English from the age of 13. The plan by education minister Mohammed al-Rasheed to introduce the language at primary level sparked heated debate over whether this would undermine Saudi culture.
According to David Burton, director of the British Council in Riyadh, some senior officials at the education ministry were concerned that putting English on the curriculum would mean less time mastering classical Arabic. "Arabic is the cultural cornerstone of Saudi society," he said. "This is the language of the Koran - not just a means of communication."
Islamic activists had been lobbying government officials hard to reverse the decision. Teaching English to youngsters "endangers Islamic identity and culture and accelerates the Westernisation of society", said one text message from campaigners.
Diplomats say the timing of this announcement, so soon before the start of the next academic year, reflects the growing conflict between conservative and reformist wings of the ruling family.
The debate has been coloured by new tensions in the relationship between Saudi Arabia and the US since September 11 due to allegations that Al Qaeda's operations were partly financed by Saudi money.
Many Saudis were angered at a recently leaked briefing to the Pentagon by influential American think-tank, the Rand Corporation, describing Saudi Arabia as "the kernel of evil" in the Middle East.