According to the UK based PFC Auctions, the vial containing dried blood sample of Reagan, taken after a 1981 assassination attempt, would now be donated to the Reagan Foundation instead.
On-line bidding on the vial, which had reached about USD 30,000 was suspended yesterday following outrage by The Ronald Reagan Presidential Foundation, the BBC reported.
The foundation, which had threatened legal action, expressed happiness over the decision, saying the blood would stay "out of public hands" now.
"We are very pleased with this outcome and wish to thank the consignor and PFC Auctions for their assistance in this matter," said John Heubusch, Executive Director of the California based foundation.
The item being donated is a five-inch glass vial that is one half-inch in diameter and has a green rubber stopper. It clearly contains traces of dried blood and is said to have been taken from a laboratory that tested Reagan's blood for lead after he was seriously wounded.
Reagan's family and surgeon had also criticised the move as an invasion into his privacy.
The seller, who wished to remain anonymous had purchased the item at a public auction in the United States in February this year for USD 3,550.
The Foundation quoted the seller as saying he was a serious collector of presidential memorabilia who had donated to museums in the past.
"I would personally be delighted to see this important artifact put on public display," the seller said.
Reagan, the 40th US President and served from 1981 to 1989, required emergency surgery after he was shot by John Hinckley Jr from a close range outside the Washington Hilton Hotel shortly after speaking to labour union officials on March 30, 1981.
