California voters rejected a ballot measure on Tuesday that would have made it the first U.S. state to legalize marijuana for recreational use.

The "no" vote on Proposition 19 had 56 percent of the vote to 43 percent for "yes," with 20 percent of precincts counted. CNN projected the measure's failure.

The nation's eyes were on Prop 19 because legalization would have put the state at odds with federal drug laws and the Obama administration said it would continue to prosecute individuals in California for possession or growth of pot.

A maverick move by California could also have inspired other states, as has been the case with medical marijuana.

California in 1996 led the nation with a ballot measure approving cannabis for medical purposes and 13 other states have since followed suit.

Passage of Prop 19 would also have had a financial impact because it cleared the way for local governments to regulate the "business side" of pot, including commercial cultivation and taxation.

Prop 19 supporters argued that ending prosecutions of marijuana possession would free up strained law enforcement resources and strike a blow against drug cartels, much as repealing prohibition of alcohol in the 1930s crushed bootlegging by organized crime.