The likelihood that Wal-Mart Stores Inc. will open its second store within Chicago city limits just got smaller.

The city of Chicago declined a request to allow the world’s largest retailer to build a store at the 50-acre Chatham Market on the South Side, a former steel plant site that the discount chain has been eyeing for at least four years.

Arnold Randall, commissioner for Chicago’s Department of Planning and Development, notified the project’s developer, Archon Group LP, a unit of Goldman Sachs Group Inc., on Friday that he would not let the project move forward