A special meeting of the authority - which was packed with protestors against fracking - decided by 16 votes to 10 with one abstention not to have an expert to put the council's case against fracking at the public inquiry next month into the new North Yorkshire County Council Waste and Minerals Joint Plan.
Coun Paul Andrews, who proposed the move to bring in a consultant, said he was "very disappointed" by the council's decision . "I and my supporters wanted a professional expert to speak for the council. As a result of the decision the developers Third Energy will have the advantage."
He warned that if fracking goes ahead Ryedale's tourism will be hard hit, as will house prices in the district.
The Plan, which will govern waste and minerals planning applications, including those to carry out hydraulic fracturing, for the next 20 years, details where drilling and other activity can take place and the numbers of wells that can be developed.
Coun Andrews called on members of the council to commit around £10,000-12,000 to employ a planning expert to represent its submission to the Plan. After a heated debate the motion was defeated.
Eddie Thornton, from Pickering, said: "We are constantly told by our government that fracking can be safe if it’s well regulated. Our council had an opportunity to strengthen those regulations last night, but despite strong voices of support, the leading Tory group voted against the interests of the community, saying it was a waste of money. This is the same council that spent half a million pounds on a failed bid to sell a car park, and yet they won’t spend £10,000 to get the best deal for Ryedale."
Around 150 people gathered outside Ryedale House prior to the meeting, but only 30 were allowed into the council chamber with council officers stating health and safety regulations as the reason for the restricted numbers.
Coun Di Keal, who supported the motion, said: “The exclusion of people who tried to attend the meeting last night was disgraceful. They simply wanted to exercise their democratic right to listen to the debate and were barred from doing so on spurious health and safety grounds.
“The council chamber has in the past accommodated far more than 30 members of the public and requests from myself and other councillors to move to another venue such as the Milton Rooms because of the level of interest in the debate were simply dismissed by officers. Some people had waited for several hours to gain entry only to be told they couldn’t unless they were selected in a ‘raffle’ of seats. It was simply outrageous and made a mockery of local democracy.”