Reding wanted a vote to make it compulsory for companies to keep 40% of seats for women.
The proposals will now be debated in November.
Reding said earlier today on Twitter: "Gender balance directive postponed. But I will not give up."
Audrey Williams, partner and discrimination law expert at global law firm, Eversheds, said: "Such a controversial proposal was never going to get an easy ride and it is unsurprising that there was strong opposition. Viviane Reding now has an opportunity to review her proposals and come back with something more palatable for those who were against her original plan.
"To address concerns that the proposed Directive could be unlawful, that could mean a significant watering down of the sanctions facing companies that don't reach any target.
"If the Commissioners can reach a consensus, any proposed new law will have to be approved by the EU Parliament and Council."
Williams added: "The Parliament will almost certainly vote in favour and, if the proposal is diluted by the Commission, could well vote to beef it up again."
Heather Jackson, founder and CEO of UK organisation dedicated to supporting women on boards, An Inspirational Journey said: "We welcome the move by Brussels today to postpone the decision on mandatory board quotas.
"It is clear that the British government, business and business women have spoken with one voice to reject quotas.
"Now is the time to permanently reject this folly and focus on the real business of creating a sustainable pipeline of talent that delivers the best and the brightest of corporate Britain's talent into board positions - regardless of gender."
UK Business Secretary Vince Cable is leading a campaign against the quota proposals, backed by ministers from eight other countries.
In the UK, the percentage of women on the boards of FTSE 100 companies has risen over the past year to a record 16%, but the UK government wants the biggest listed companies to have a minimum 25% of female directors by 2015.
More to follow
