Dean Freeman said the city’s “worn out” music scene is one reason the event is on hiatus.
People who have already bought early bird tickets will get a full refund, he said.
But Mr Freeman is hoping to develop it for a re-birth in 2018.
“It’s sad that the festival needs to take a break but to be honest, I am worn out and Wakefield music feels worn out too,” he said.
“So many venues have disappeared. There are a couple of big spaces like Warehouse 23 and Theatre Royal that are great but without those smaller grassroots venues things diminish, and that’s what has been happening over the last few years.”
He said that the festival brings in around £100,000 a year to businesses in the city, but the difficulty in getting anyone to support it has been a recurring problem.
He added: “I hope the break will give me time to approach it in a different way and hopefully people will miss it too.
“I’m most sorry to the fans as LongDivision goers are the best musics fans ever.”
The festival has brought indie bands such as Field Music, Los Campesinos!, The Cribs and post punk legends Gang of Four to the city in the past.
For more details about the hiatus, visit http://longdivisionfestival.co.uk/long-division-on-hiatus-for-2017