In a statement posted on social media, the MP for Birkenhead said it was “clear that momentum has shifted” and she wasn’t going to progress to the next stage.
She said she will be nominating Education Secretary Bridget Phillipson, who is the current frontrunner.
Ms McGovern said: “Despite picking up support today it is clear that the momentum of this contest has shifted and I am not going to progress to the next stage.
“I am pulling out of the race now to allow my supporters to switch their nominations to one of the remaining candidates before the deadline.
“I want to thank everyone who has offered me support and encouragement in this race. I will be nominating my friend and colleague Bridget Phillipson as the candidate best placed to unite our party and take the fight to our opponents.”
The deputy leadership contenders need 80 nominations from fellow Labour MPs by 5pm Thursday to stay in the race.
Ms McGovern was coming last according to a tally released by the Parliamentary Labour Party (PLP) on Tuesday evening, when she had just two nominations compared to Ms Phillipson’s 44.
Last night sources close to her insisted there was time to catch up, and that the PLP’s tally didn’t reflect the full level of support behind her.
In announcing her deputy leadership bid, Ms McGovern had pitched herself as someone who could fight against populism.
She repeated that message in her exit statement, saying for Labour to win the next general election it must “not concede the progressive argument”.
“Standing up to the far right and the populists can only be done with a progressive argument, and I will keep making it in support of whoever our deputy leader is,” she said.
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