The homelessness charity will now await a verdict from the Scottish Housing Regulator.
Shelter Scotland is set to drop legal action against Glasgow City Council following the announcement of an intervention by the Scottish Housing Regulator.
The homelessness charity had been seeking a judicial review over alleged gatekeeping by the council, where homeless people are denied access to services and temporary accommodation.
However, the legal threat has now been withdrawn in the wake of the Scottish Housing Regulator announcing an inquiry into the service in December.
Branding the announcement a “major victory” for its campaign, the charity said it would now await the regulator’s verdict.
Graeme Brown, Shelter Scotland director, said: “Until last month’s 11th-hour intervention, the regulator was not using the full range of their legal powers to fix homelessness services in Glasgow.
“This regulator inquiry is long overdue and would not have happened if it wasn’t for the 10,000 people in the city and beyond who gave us their support. It means that the regulator will focus on the failure by Glasgow City Council to meet its statutory obligations.
“This is a huge victory for everyone who has supported us in our campaign to get Glasgow City Council to honour its legal responsibilities. Those in power were ignoring this massive injustice. They are not ignoring it anymore.
“Our attention now shifts to the regulator and we will be sharing our evidence of the council’s ongoing failures from our Glasgow hub.”
Mr Brown said Shelter would provide all its evidence to the regulator to assist the inquiry and that the charity was prepared to return to court if necessary.
However, he added: “The inquiry from the Scottish Housing Regulator brings new hope that this grave injustice can be stopped without going to court.
“The regulator still has the option to replace the city council’s management team if they cannot show that they are capable of upholding their legal duty to guarantee safe temporary accommodation to every homeless person who needs it.”
Glasgow City Council, which strenuously denies claims of gatekeeping, welcomed the move.
A spokeswoman said: "Shelter's legal action had no impact on the regulator's decision and we welcome their move to abandon their court case.
"We are working constructively with the regulator in order to improve homelessness services and our door remains open to Shelter to engage positively with us."
