The HS2 rail line will not be extended to London Euston unless enough private investment is secured for the project.
If cash is not put forward by private funds, the high-speed line will only run from Birmingham to Old Oak Common in the capital's western suburbs.
This would mean passengers travelling to central London would have to change.
The government has said it is "getting a grip of plans" for Euston, adding there had been two "unaffordable designs" for a "gold-plated" station.
It has already cut the number of planned platforms for high-speed trains from 11 to six.
The BBC has been told the project at Euston would be dependent on private investment, with the government stating it would take on the "lessons of success stories" on other schemes such as the redevelopment of Battersea Power Station and King's Cross station.
Old Oak Common will be the UK's largest newly built railway station when opened, but there are concerns over the lack of options for onward journeys with government modelling suggests two-thirds of people would prefer to travel to or from Euston.
The Department for Transport (DfT) stated it wanted Euston station to "be open and running trains as soon as possible", and that its "rescoped approach" would save 拢6.5bn.
A spokesperson said there was "already support and interest from the private sector", adding that ministers had held discussions with key partners since the announcement.
"It is simply wrong to talk down the scale and benefits of this regeneration," the spokesperson said.
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To "get the best possible value for the British taxpayer", DfT officials said they would "ensure that funding is underpinned by contributions from those people and businesses its development supports" and by leveraging "private sector investment".
But critics have attacked the change in stance, with railway consultant William Barter, whose recent clients include the government, calling the new plans "totally unambitious".
As part of the now scaled-back proposals, a planned pedestrian tunnel linking Euston station with the nearby Euston Square tube station has also been scrapped.
Image source, Grimshaw ArchtechtsExtending HS2 to Euston involves digging a 4.5-mile tunnel from Old Oak Common and building a new station at Euston next to the existing West Coast Main Line terminus.
Work had already started on Euston, but it was halted in March because costs had ballooned to 拢4.8bn, compared with an initial budget of 拢2.6bn.
A document issued by the DfT said the government would look to create a "transformed 'Euston Quarter' - potentially offering up to 10,000 homes" as part of its new plans for the station.
Georgia Gould, leader of Camden Council which is where the station is being built, said the "worst-case scenario of the station being abandoned in its current state had been avoided, warned pledges on affordable housing, jobs and investment locally must not be broken.
Mr Sunak said on Wednesday that a new development company, separate from HS2 Ltd, would manage the delivery of the Euston project, adding there "must be some accountability for the mistakes made, for the mismanagement of this project".
The prime minister has pledged money saved as a result of the northern leg of HS2 being axed would be spent on alternative rail, road and bus schemes instead across the country.
But the government has already U-turned on one of those plans, which would have restored a mothballed railway line in the North East of England, within 24 hours of the announcement.
The Leamside rail line was originally set to be funded by the 拢36bn savings, but references to it were removed from the government's website later on Wednesday.
Transport minister Richard Holden said the government had only committed to "looking into" the scheme.
A government spokesperson said 拢1.8bn was being provided to the North East to fund the transport projects that matter most to their communities - including funding for the Leamside line if they wanted.
