The Dunnellon City Council rejected a motion to seek an injunction over February's rail tie fire.
Marion County already filed the complaint earlier this month, meaning the city is unable to join.
However, the city attorney says there may still be other legal pathways to get involved.
Dunnellon Vice Mayor Tim Inskeep was against the injunction, saying cleanup efforts are already underway.
City officials say the remaining ties are expected to be removed by the end of April.
Area residents raised concerns about the cleanup timeline, and many spoke in support of the legal filing.
One resident questioned why council members appeared so supportive of CSX.
City leaders say their options remain open, and further legal discussions will be had if compliance is not met.