Sponsors pulled all remaining Mardi Gras and carnival parades out of the city yesterday, saying they would not permit the festival to remain the hostage of striking police.

Plans were to move some of the 18 remaining parades to the suburbs, but the biggest, including the fanciest ones that would have rolled on Feb. 27, Mardi Gras, appeared doomed unless the strike is settle.

Taking the parades out of New Orleans does not cancel Mardi Gras, a holiday celebrated like New Year's. But it would eliminate much of the pagentry that makes it a gorgeous street party. Their cancellation would not close bars or affect private parties, banquets or balls that are a part of the celebration.

Mardi Gras is a $50 million industry in New Orleans. Police union spokesmen have called the festival "our four aces" in seeking to wring concessions from the city in the 4-day-old strike.

"It was a needed thing," a parade spokesman said of the decision to pull out. "They were holding Mardi Gras hostage. Well, we've taken the ransom."

It was only the eighth time that the parades have been canceled, and the first time since the Korean War. A parade organizer said the events could be rescheduled within 24 hours if the strike ends.

Some hotels reported that the strike has contributed to a 25 percent decline in business.

A federal mediator kept negotiations going in the strike by 1,100 policemen, while the city was patrolled by an 800-person substitute force of state police and National Guardsmen.