Legendary Wan Chai haunt Neptune II has been shut down, with the Liquor Licensing Board refusing to issue it a new licence.
The basement club in Jaffe Road, established in 1993, was one of the most popular dance clubs in the city. However, for the past two weeks its shutters have been pulled down and its doors closed.
Staff at its sister bar - Neptune III in Lockhart Road - said Neptune II was closed for renovation, but considering that it is the busiest time of the year for the city's nightspots, this seemed unlikely.
The Food and Environmental Hygiene Department later confirmed that Neptune II's bar licence had not been renewed, but did not give a reason.
The bar was a notorious haunt of prostitutes, but police said no arrests had been made there in recent months.
The real reason for its closure is understood to be much less controversial, with an industry source revealing that its liquor licence was turned down because of overcrowding.