Work to alter the Newton Bar roundabout, to the north of the city centre, was due to start in the new year.
But Wakefield Council has now put the £9.5m project, which was aimed at improving traffic flow at the busy junction, on hold.
It follows a demand from the group Just Transition Wakefield, who fear the destruction of more than 100 mature trees on the junction's western side.
Group spokesman Stuart Boothman said there was "no obvious benefit" to the scheme, which was due to be funded by the West Yorkshire Combined Authority (WYCA).
Mr Boothman said: "We’ve demanded that the scheme is cancelled on the grounds that it’s not going to deliver value for money.
"£9.5m is going to be a significant amount of money, given the 107 mature trees that are sequesting carbon from the traffic will be destroyed.
"We’re unable to see how any changes to junction will lead to a significant improvement in traffic flow.
"We remain absolutely unconvinced on that.
"However, if we are wrong and the schemes lead to improved traffic flow it’s going to increase traffic and therefore carbon emissions.
Mr Boothman added: "It makes no sense to press ahead with something that’s going to deliver, at best negligible improvements, while at the same trashing the environment at a cost of £9.5m."
While the council is believed to have committed to replacing the axed trees, Just Transition say it will take many years for the new ones to be as effective at offsetting carbon.
The roundabout connects Bar Lane, on which Pinderfields Hospital stands, Newton Hill and Leeds Road.
Plans to improve the junction were first conceived in 2018, and the scheme would see traffic lights and pedestrian crossings installed, with a view to making the area safer.
The roundabout itself would also be enlarged, with new lanes created for drivers and cyclists.
A memorial to five police officers, who lost their lives in a fatal coach crash in 1978, was also planned.
Glynn Humphries, the council's service director for the environment, said: "We value our engagement with Just Transition and Friends of the Earth and are considering their input alongside the benefits of the road improvement scheme to try and find the right balance, so we can do our best to meet the challenges we all face to address climate change.
"The Newton Bar scheme is currently paused pending the outcome of this review.”
The revamp was given planning permission in 2019 and funding for it signed off a year later.
The works, however, were delayed by the Covid pandemic. Should they start in January, they are expected to take more than a year.
2018 estimates published by the council suggested around 35,000 drivers pass use the roundabout every day.
That number's likely to have increased, given the new homes that have been built in the area since.
Local Democracy Reporting Service