Her announcement came a day after the organisers moved the High Court for the event to be allowed as the Karnataka government had refused permission for it after protests by Kannada outfits.
"Since the police of Bangalore have publicly said that they will not be able to ensure mine & all who attend safety for my New Years event, my team & I feel safety of the people should always come first therefore I cannot attend. God bless & I wish everyone a safe & happy New Year! (sic)" she tweeted.
In a petition filed in the High Court, event management firm TimeCreations said pending police permission, it is unable to forward requests and submit necessary clearances to various authorities, including city civic body Bruhat Bengaluru Mahanagara Palike and the fire department.
The firm proprietress HS Bhavya said in her petition filed yesterday that she had submitted a letter to police to permit the show.
The government had on December 15 disallowed the show in Bengaluru and elsewhere in the state after protests by Kannada outfits, which said it would be an "assault" on city's culture.
Karnataka Rakshana Vedike and other outfits had held protests, taking out rallies and burning effigies of Sunny Leone.
In her petition, HS Bhavya alleged that on December 16, the police verbally refused permission, but did not give it in writing.
She said due to this, all other arrangements and sanctions ran into a disaster, resulting in lenders asking the organisers to return their money, fearing the uncertainty.
HS Bhavya also alleged that the protestors are seemingly and by records supposed to be anti-social elements engaged in acts of vandalism and creating of unrest.
"Their unfair threats and pressure should not be the driving force for the state police to take such unmindful decisions," she pleaded.
Sunny Leone was scheduled to perform at Manyata Tech Park in the city suburbs.