Over two thirds of activists voted against a change to the party's constitution to drive up the number of women MPs - from just three out of 46 - at the opening debate at the party's annual conference in Brighton.
Candidates would have been selected through a process of "clustering" or dividing constituencies into groups of three, with at least one, but no more than two female candidates in each group. Seats held by Liberal Democrat MPs would have been included in the clusters, but sitting MPs would have been safe from deselection.
Baroness Williams, a founder member of the SDP, passionately warned that continued opposition to positive action would be seen by the electorate as being "out of touch". She said: "Let us not turn our backs to the future. Those who say positive discrimination will not work, say it because they do not want it to work.
"We will not get more women involved just by simply providing more training and education. The position ... is not going to change until we address the issue of discrimination. ... Let us end the old boys' network at the House of Commons."
Steve Hitchins, a counsellor in Islington, North London added it would be "illiberal", not to change a distortion in the democratic system. It is our role as Liberals to promote change and reduce social injustice."
But many activists condemned the motion, that was tabled by a block of 20 delegates, as "fundamentally illiberal, unworkable and undemocratic", stressing that constituencies should have the right to choose their own candidates.
"It would be ridiculous and against our principles as Liberals because it could drive out long standing and experienced male, would-be candidates," said one member.
The motion was the second time since the 1997 election that steps to improve the representation of women in the party was overturned. Activists pointed to last year's conference in Eastbourne when a move to get equal numbers of men and women short-listed for Parliament was also rejected. But last year's conference did agree overwhelmingly to introduce measures to guarantee more women candidates for next June's Euro elections by introducing the "zipping" system, whereby male and female candidates are alternated on party lists in proportional representation elections.
Nan Kirsen, leader of North Somerset district council, said: "I don't want to be selected because I'm a woman, I want to be selected because I'm the best man for the job." Brian Orrell, Kensington and Chelsea, London, condemned clustering as a "sure-fire recipe for disharmony" and "entirely impractical".
Lisa Whellmans, from Newbury in Berkshire, warned the scheme could prevent capable women from being selected in some constituencies, while inferior males were picked in their place. "The truth is there are just not enough women candidates available. The reality is that the party needs more women on the approved list of candidates."
After the debate, Alison Ryan, an equality campaigner, said the defeat of the motion was a "real missed opportunity ... the Liberal Democrats were the only major party not to increase the proportion of women MPs at the last election".Reuse content