The cast and crew of the show, which is filmed in Greenock, were told yesterday that there would not be an 11th season. A further 20 episodes are still to be screened with half in the autumn and the remainder next year. However, the broadcaster has begun to develop a new drama for the 8pm slot.
It is the third time this year the BBC has canned shows filmed in Scotland, with the Review Show and Newsnight Scotland both shelved in recent weeks.
BBC1 Controller Charlotte Moore announced the news yesterday morning on the broadcaster's official Twitter account.
She said: "We are incredibly proud of Waterloo Road, and would like to thank Shed Productions and all the cast and teams involved. We still have 20 episodes to look forward to and we'll be sending the show out on a high.
"On BBC1 it's important to make room for new drama and we are committed to commissioning new drama series for 8pm. There are some really exciting ideas currently in development but nothing to confirm yet."
Waterloo Road has starred a number of prominent Scots actors including Laurie Brett as current headteacher Christine Mulgrew. Taggart-star Alex Norton also featured in a handful of episodes along with compatriots Alec Newman, Caitlin Gillespie and James Young.
With an average viewing audience of around three million, the drama is arguably one of the BBC's most popular programmes at the moment.
However, since the production relocated from Rochdale to Greenock three years ago, viewing numbers have dropped considerably. Donalda MacKinnon, head of programmes at BBC Scotland, said: "It's always sad when any long-running show comes to an end and I know the Waterloo Road team will miss Greenock — as will fans of the show. Our firm aim now, however, is to use that to continue growing the TV and the wider creative sector here in Scotland, utilising the increased skill base arising from Waterloo Road to build up future home-grown culturally representative output."
Greenock has been a popular filming location in recent years, following on from the success of notable Scottish movies such as Dear Frankie and Sweet Sixteen.
While the news of Waterloo Road's demise has been greeted with "bitter disappointment", Inverclyde MSP Duncan McNeil is hoping other productions choose to make use of the town's experience.
"Waterloo Road brought many benefits to the area," he said. "I know local people felt a connection with the show and felt involved in its production.
"It also promoted the area very successfully and showed Inverclyde in a complimentary light — something we are keen to continue. We were delighted to have had the opportunity to host the show and it has helped us to develop our considerable experience in hosting filming companies.
"We hope that the BBC and others keep that in mind when developing new shows in the near future."