Councillors David Doran and Jim Ryan called for a ban on parking there for a trial period of three months.
David Doran claims the town is losing out because of the bottleneck being created on Parnell Street as he feels some motorists are avoiding Thurles completely.
The call for double-yellow lines to be put in place was ultimately defeated by 6 votes to 2.
One of the strongest opponents was Councillor Seamus Hanafin.
He feels preventing parking on Parnell Street would be a retrograde step and would damage the fabric of life in the town centre.
The Fianna Fail representative says businesses and people in the area should be considered and not just motorists passing through.
