Ms Waites, who was a Labor senate candidate at this year's federal election, said the "extremely difficult" decision was made for family reasons. She declined to elaborate.

Party sources have told The Canberra Times that Ms Waites was encouraged by some members to nominate to run in Murrumbidgee rather than Kurrajong, therefore avoiding a contested ballot in the inner-city seat. This account is disputed by other Labor party sources.

In any event, only five candidates nominated in Kurrajong, meaning a ballot wasn't required. Ms Waites was preselected alongside Chief Minister Andrew Barr, Health Minister Rachel Stephen-Smith, political staffer Jacob Ingram and public sector union official Madeline Northam.

ACT Labor's new secretary, Mel James, confirmed Ms Waites' withdrawal from the election race. She described Ms Waites as a "wonderful asset", but was confident a strong replacement could be found.

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Leah Dwyer, who ran for Labor in Kurrajong at the 2016 election, has been spoken of as a potential replacement for Ms Waites. Ms Dwyer, who works for the feminist not-for-profit YWCA, said she was "weighing up her options" when contacted by The Canberra Times on Monday.

She won 3.9 per cent of vote in 2019, finishing ninth among all candidates in Kurrajong.

It is highly unlikely whoever fills Ms Waites spot will ultimately win a place in the next ACT Legislative Assembly. Mr Barr and Ms Stephen-Smith are odds-on to secure the two places Labor will most likely win in the electorate at next October's ballot.

Ms James said ACT Labor's branch council would be convened, most likely early in the new year, to ratify Ms Waites decision to withdraw her candidacy. The council would then decide whether to fill the vacancy, and, if so, who the new candidate should be.

Steering the process will be among the first tasks for Ms James as ACT Labor's new party secretary. The former chief of staff to Health Minister Rachel Stephen-Smith has replaced Matt Byrne, who formally stepped down from the role on Friday.