The measure, which would have barred doctors within city limits from performing abortions after 20 weeks of pregnancy, unless a mother's life was in danger, was rejected 55 percent to 45 percent.
Abortion rights advocates hailed the outcome as a victory against out-of-state anti-abortion activists seen as spear-heading an initiative.
Supporters of the measure predicted that similar proposals would gain ground in other cities and states across the country.
The proposed 20-week cutoff on abortions in the Albuquerque measure allowed for few of the exemptions permitted in most late-term abortion bans enacted in other states in recent years. It contained no exceptions for victims of rape or incest, and would have waived the ban only to save a mother's life or if continuing her pregnancy risked "substantial and irreversible physical impairment of a major bodily function."
A record number of city voters were reported to have cast early ballots in the special election.
And an unusually high overall turnout was expected due to the controversial nature of the measure, said by those on both sides of the campaign to mark the first proposed abortion restriction submitted to voters in a U.S. city.
The U.S. Supreme Court legalized abortion nationwide in 1973, but ruled that unless the mother's health were at risk, states could place restrictions on abortion at the point when a fetus could potentially survive outside the womb, generally seen as starting at 22 to 24 weeks of gestation.
A full-term pregnancy typically is about 40 weeks, and abortions after 20 weeks are rare.
Still, abortion opponents have pushed the boundaries of the landmark Roe v. Wade decision in recent years by seeking to curtail abortions at earlier stages of pregnancy.
The Albuquerque measure was patterned after restrictions enacted by a dozen states based on hotly debated medical research suggesting a fetus feels pain starting at 20 weeks of gestation.
Two of those states, North Dakota and Arkansas, went further by also recently banning abortion as early as six and 12 weeks, respectively. Those more restrictive bans have been put on hold by courts. Courts have likewise blocked 20-week abortion bans in Arizona, Georgia and Idaho.
