LOS ANGELES - Sony Pictures abruptly cancelled Wednesday the release of the comedy which has angered North Korea and triggered chilling threats from hackers, reportedly suspected to be ordered by Pyongyang.
The Hollywood studio announced the decision after the majority of US theatre chains said they would not screen "The Interview" about a fictional plot to assassinate North Korean dictator Kim Jong-Un.
"In light of the decision by the majority of our (theatre) exhibitors not to show the film 'The Interview,' we have decided not to move forward with the planned December 25 theatrical release," it said in a statement.
"We respect and understand our partners' decision and, of course, completely share their paramount interest in the safety of employees and theatre-goers," it added.
Regal, AMC and Carmike theatres were among US chains who had said they would not show the madcap movie, as was Canada's Cineplex Entertainment. A scheduled premiere this week in New York was also cancelled.
Skittishness about attending the movie followed threats by the so-called GOP (Guardians of Peace) hacking group, which invoked the September 11, 2001 attacks in an ominous warning to any movie-goers planning to see the film.
In a message written in broken English, the group said a "bitter fate" awaited any who attend the film.
"Soon all the world will see what an awful movie Sony Pictures Entertainment has made. The world will be full of fear," the statement warned.
It added: "Remember the 11th of September 2001. We recommend you to keep yourself distant from the places at that time. (If your house is nearby, you'd better leave.)"
North Korea has denied involvement in the brazen November 24 cyber-attack, which some expert said could possibly have been carried out by disgruntled workers or by supporters of North Korea furious over the movie.
NKorea behind hack attack?
But US media including CNN reported Wednesday that investigators now believe that North Korea is behind the massive hack. Representatives for several agencies including the FBI declined to comment on the reports.
"Of the characters who are out there, the most likely suspect is North Korea," James Lewis, a former State Department official, told reporters in Washington.
The US State Department meanwhile sought to distance itself from the film, while defending the right to free expression.
"We're not in the business of signing off on the content of movies or things along those lines," said spokeswoman Jen Psaki."
President Barack Obama meanwhile said Americans should not be concerned about threats linked to movie theatres. "For now, my recommendation would be: go to the movies," he told ABC News.
Actor Rob Lowe, among a number of stars who have small cameo roles in the movie, voiced his surprise on Twitter.
"Wow. Everyone caved. The hackers won. An utter and complete victory for them. Wow," he said.
"Hollywood has done Neville Chamberlain proud today," he added, in reference to the British leader's infamous appeasement of Hitler before World War II.
In addition to the threats, Sony has seen the release of a trove of highly unflattering internal emails, unpublished scripts and other internal communications, including information about salaries, employee health records and other personal information.
On Monday, Sony Pictures boss Michael Lynton sought to reassure employees that the studio would not be destroyed by the leaks.
"This will not take us down," Lynton told employees, adding: "You should not be worried about the future of this studio."
On Tuesday, lawyers filed two class action lawsuits against Sony Pictures in Los Angeles.
One of the suits alleged that "Sony failed to secure and protect its computer systems, servers, and databases, resulting in the release of the named plaintiffs and other class members'" personal data.
"An epic nightmare, much better suited to a cinematic thriller than to real life, is unfolding in slow motion for Sony's current and former employees," the 45-page lawsuit said.