The event, which originally doubled as an Olympic qualifying competition, will just serve as an "operational test" and be run by the Olympic organizers.
FINA said in a statement on Tuesday night that the artistic swimming Olympic qualification event, which had been scheduled for early March, will be moved outside Japan and held in June. But the location has not been decided, Xinhua reports.
The Tokyo 2020 organizing committee said the worsening Covid-19 situation in Japan is not the reason that has forced FINA to cancel the event.
"All parties have come to the conclusion that it will be difficult to hold the event in Tokyo due to challenges posed by the schedule of other international aquatics events and the need to commence adaptation of the venue for the Olympic Games in mid-May," read a statement from the organizers.
Japan has been suffering a fourth wave of Covid-19 infections since late March, with the western prefecture of Osaka on Tuesday requesting that the central government declare a fresh state of emergency for the region.
Similarly, informed sources said the Tokyo metropolitan government will request the central government to declare a new state of emergency in the capital this week as it also struggles to deal with a surge in Covid-19 cases.