The Scotland midfielder looked to be heading to the King Power Stadium after the two clubs settled on a ??1m fee, the same amount Wigan paid Celtic to secure his services on transfer deadline day in August 2011.
But Maloney, who has won the FA Cup during his spell at Athletic, will not now be joining the Premier League???s bottom club unless City come in with an improved offer, or another side enters the bidding during the current transfer window.
Latics manager Malky Mackay revealed the news and also confirmed Maloney could instead be on his way to the MLS at the end of the current Bet Championship campaign.
“We accepted a bid for Shaun Maloney, but the personal terms fell through. He’s our player until the end of the season,??? Mackay told Wigan???s official Twitter feed.
“Interest was from Leicester, and there’s still interest from Chicago Fire. Shaun’s our player unless a new offer comes in.”