Oxford City Council said the money had mostly been used for "ground investigations of possible sites" but nowhere suitable had been found.
Two cemeteries still have space, in Wolvercote and Botley, but they are expected to be full by 2018 and 2021.
The council said it had not given up and was "still exploring options".
Linda Smith, board member for leisure, parks and sport, said the council has been "searching for a suitable new burial site for many years".
She added: "But ultimately, as with new housing sites, we have run out of suitable land within Oxford.
"So far all the council-owned sites that we have identified have, following ground investigations and surveys, had to be discounted.
"Either due to the size of the site, the ground conditions, a high water table or a covenant restricting the use of the site."
After the two remaining cemeteries are full the council said only the reopening of family plots, the use of a few reserved plots, and the interment of ashes would be possible.
The last increase in burial space in Oxford was in 1932.
A council has spent £30,500 unsuccessfully searching for new burial sites in Oxford over the last four years.