Leeds have withdrawn plans to build a £25m training facility close to Elland Road in favour of increasing the stadium's capacity to 55,000.
The club had received backing from Leeds City Council (LCC) to relocate their Thorp Arch academy to the former Matthew Murray High School site, located close to the M621 just a few hundred metres away from the stadium.
Plans had already been agreed by LCC for Leeds to increase the capacity at Elland Road from 39,000 seats to 50,000.
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A report from LCC's director of city development to the council's executive board said: "Following the promotion of LUFC to the Premier League and the club securing investment from the San Francisco 49ers', the club have reviewed their stadium development ambitions and want to preserve their ability to deliver an expanded 55,000-seater stadium at Elland Road, as opposed to a 50,000 seat capacity previously agreed."
The report said the 5,000-seat increase would require development on the Fullerton Park site next to the stadium and separate plans to build a community sports hub at Fullerton Park, the Parklife project, will now be switched to the Matthew Murray site.
Facilities provided by Parklife include four 3G artificial grass pitches, a community cafe, changing facilities, a gym, NHS treatment rooms and a pharmacy.
LCC leader councillor James Lewis said: "The fantastic return of Leeds United to the Premier League has proved to be a great boost to not just fans, but also the city as a whole.
"We remain committed to working with the club constructively in terms of any ambitions they might have in terms of increasing the capacity of Elland Road in the future, which is why following discussions, we agreed to look at what options could be available to move the proposed Parklife project from Fullerton Park to another location."
Councillor Lewis added: "We are confident that the Matthew Murray site will be an ideal location for Parklife, a view which is shared by local stakeholders, the Football Foundation, Leeds United and our partners at the NHS."
Leeds' managing director Angus Kinnear revealed initial plans to expand Elland Road in October 2019 during his speech at a civic reception as the club celebrated their centenary.