Image copyright Getty Images Image caption The police fatally shot Philando Castile during a traffic stop in 2016
A bipartisan group of US lawmakers had been meeting to try to reach an agreement on police reform legislation.
They say they have failed to reach an agreement on policing issues including body cameras and police accountability.
But they say they will continue their efforts and keep the government open.
The failure to reach an agreement could mean the three-week government shutdown goes on.
The funding will be needed to pay federal workers who are absent from work because of the standoff between the Democrats and Republicans over an immigration bill.
So far the Republicans have failed to secure enough votes for the legislation.
Image copyright AFP/Getty Images Image caption Senator Richard Shelby (R-AL) said he didn’t agree with the idea of a legislative solution in light of the killing of Jamal Khashoggi
The US has experienced a number of high-profile police killings over the last year, leading to nationwide protests against law enforcement.
Senators on both sides of the aisle have blamed the Democratic Party for being too hard-line, with Senator Jeff Flake of Arizona saying: “The most hard-line positions have made this worse. Democrats need to reach out to the police more.”
In the House, Republicans refuse to even consider legislation that would prevent the Department of Justice from funding changes to standards for the use of force by law enforcement.
Their demands, which would first have to pass the Senate, are essentially the same as those the Democrats want.
But Democrats are trying to change House Republican rules to ensure that their legislation is debated without a filibuster – their attempt to block the agency from funding initiatives they do not agree with.
“Republicans are bending over backwards to try to prevent us from doing anything about police reform,” said Congressman Jerrold Nadler, a Democrat from New York.
Image copyright AFP/Getty Images Image caption President Donald Trump and Democratic leaders Richard Neal and Nancy Pelosi have traded bitter personal attacks
Some believe a deal could have been reached if there had been a Republican president and a Democratic House speaker – Donald Trump and Nancy Pelosi, for example.
But President Trump and Democratic leaders have traded bitter personal attacks.
On Wednesday, he called her “Cryin’ Chuck” Pelosi, and added that she was “a dead woman walking”.
The House Speaker responded by throwing more serious accusations his way, calling the President a liar.
The country’s Capitol will not reopen without a deal on funding.
As far as Capitol Hill goes, this latest failure seems almost inevitable, but the Democrat-controlled House could still fail to come to an agreement with the Senate, which is currently controlled by Republicans.
So there is the possibility of a shutdown – with the possibility of a possible resolution, or not.