They walked out of the Legislative Council as the bill looked to be defeated, reports said, BBC reported.
The bill got eight vote while 28 lawmakers voted against it. The bill needed at least 47 votes to pass.
"This motion has not gained a two-thirds majority vote," said Jasper Tsang, the president of the city's Legislative Council. "I announce that the motion has been vetoed."
The reforms suggested by China would have given it the right to vet candidates in the election of the territory's leader.
The reform package has been labelled as "fake democracy" by Hong Kong leaders.
The package designed by China would have given all Hong Kong citizens the right to vote for their chief executive for the first time in
2017, but they would only be able to vote for candidates that had been vetted by a pro-Beijing committee.