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LCI, whose nine other casinos in the UK remain open, hopes to relocate staff if possible but acknowledged this may be difficult.
Alea, based at Clarence Dock, announced the immediate closure yesterday, with both Leeds Kitchen, run by celebrity chef James Martin, and The Bird, run by Michelin starred chef Vineet Bhatia, shutting down as a result.
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LCI said the government's lack of support for casinos which are being hit by the growth in online gambling and a belief that Leeds Council wanted a fresh site for a new casino rather Alea's existing site had led the company to "reluctantly" withdraw its bid.
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Alea Leeds Clarence Dock casino to close UPDATED
A Leeds Council spokeswoman said: "Any announcement of jobs losses is very bad news to the city and we work hard to encourage new investment and employment opportunities.". The council could not comment on the large casino licence while the application process continued, she added.
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London Clubs International (LCI), which runs Alea, also announced it was withdrawing from the lengthy competitive process to run a large casino in Leeds. The city was one of eight chosen by the government as potential venues for a major casino nearly five years ago but plans have still to be finalised.
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Roy Ramm, spokesman for LCI, said the company had made "a significant investment into Alea when it opened in 2008. but current trading conditions in the Clarence Dock development have made this outcome inevitable."
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