Former world champion Armstrong's agent pressed this week for improved terms after giving his verbal agreement to a new contract, Cofidis said.
``Faced with this about-face, in contradiction with respect for the given word, in the face of so much ingratitude and disloyalty, Cofidis have decided not to renew Lance Armstrong's contract, which we have told his agent,'' a team statement said.
Armstrong learnt he had cancer just after he signed for Cofidis as a team leader for the 1997 season in October 1996.
``Cofidis could then legitimately have withdrawn (from the contract), as Lance Armstrong was manifestly not in a state to race for months and did not even know whether he would be able to ride again one day,'' a team statement said.
It said that Cofidis decided instead to honour the contract -- which was for a year with an option for another year -- ``letting human considerations prevail over all financial considerations.''
Armstrong, who has made a remarkable recovery from his illness, has not raced for Cofidis, but the team said they had planned to keep him on next season after doctors authorised him to return to competition.
But Cofidis said that with renewal of the contract imminent they learnt that Armstrong's agent was also talking to another sponsor and the rider was on the point of signing for a different team.
Cofidis then improved Armstrong's terms and reached a verbal agreement with the agent that they would announce a new contract at a joint news conference on Tuesday.
But the agent cancelled the news conference days before it was due to be held and made further demands, Cofidis said.
Earlier this week the Russian set October 19 at Bordeaux as the day he would try for Chris Boardman's mark of 56.375 kms set in Manchester last September.
But after finishing three minutes 59 seconds slower than the new time trial champion, Laurent Jalabert of France, on Thursday, Berzin said he would have to reconsider the situation.
``I will discuss the record attempt with my manager, Emmanuele Bombini, after Sunday's road race,'' he said.
``Every time I ride a big race I flop, and I want to race on Sunday to discover if the problem is mental or physical.''
Berzin has failed to find the form that in 1994 took him to victory in the Tour of Italy and the Liege-Bastogne-Liege classic.
3 Peaks Cyclo Cross UK