Conservationists said the move would save 5500km2 of wilderness from being carved up in the search for bauxite.
The Mitchell Plateau is one of the only places in Australia with no recorded species extinctions since European settlement.
Norwegian-owned Norsk-Hydro confirmed it had returned its mining leases to the State Government because there is not enough information on conservation issues in the region.
“This decision has been taken based on a number of considerations, among other things the current lack of knowledge and scientific documentation relating to the environmental values of the region.
“We support the present process of establishing a better documentation. Development decisions in this region should in our view be taken in the context of a comprehensive development plan for the Kimberley,” Norsk Hydro Project Director Wenche Agerup said.
The Wilderness Society’s Kimberley Campaigner, Josh Coates congratulated the company and is urging others to follow suit.