Tuvalu and other low-lying small island nations will be first victims of rising sea level and it proposed amending the UN climate treaty to require nations to keep temperature rise to 1.5 degrees Celsius above preindustrial levels.
Danish president of conference Connie Hedegaard declined to advance the proposal after objections from some other countries, including oil producers, which will be hurt by the proposed strict limits on using fossil fuels.
India and China also opposed Tuvalu's call, saying the COP 15 should stick to the Bali Action Plan and the protocol to battle climate change.
Both India and China strongly opposed any movement away from the protocol on grounds that it would detract from the ongoing discussions and opening a third track of negotiation would further dilute the process.
"By asking us to discuss new proposals for a protocol you are actually asking us to express a no-confidence in the Kyoto Protocol," said Vijai Sharma, India's Environment Secretary.
"We should not and cannot sidestep out own legitimate processes and create more hurdles for ourselves," he added.
"The proposals for a new protocol at this stage while we are still engaged in negotiations for an agreed outcome under Bali are therefore premature," Sharma said.
Sharma was joined by China's lead negotiator Su Wei who said, "The main task of this (conference) is to adapt an agreed outcome from the Bali Action Plan and we should very much focus on that".
"We have a very valid system to combat climate change," Wei noted.
Tuvalu delegate Ian Fry said his country could accept nothing less than full discussion of its proposal for a new legal protocol, which was submitted to the UN climate convention six months ago.
"My prime minister and many other heads of state have the clear intention of coming to Copenhagen to sign on to a legally binding deal. Tuvalu is one of the most vulnerable countries in the world to climate change, and our future rests on the outcome of this meeting," he said.
The call was backed by other members of the Association of Small Island States (AOSIS), including the Cook Islands, Barbados and Fiji, and by some African countries, including Sierra Leone, Senegal and Cape Verde.
"Our future rests on the outcome of this meeting," Fry said.
The negotiator of Tuvalu called for a suspension of the entire COP proceedings until the matter on a new protocol was resolved. Eventually, Hedegaard set aside the proposal.
Besides China and India, the proposal was protested by oil producing nations including Saudi Arabia that said it could not accept the strict limits on burning fossil fuels.
This disagreement also indicates a wider split that is emerging between the richer developing countries like China, India, South Africa and the poor African states and Alliance of Small Island States.
This split is also reflected in the divergences in the draft of a potential treaty framed by BASIC (Brazil, India, South Africa and China) nations, on which the AOSIS countries said their particular vulnerabilities have not been addressed.
The Indian delegation here pointed out that India with "hundreds of islands, a vast coastline, Himalayan glaciers" is amongst the "the most vulnerable countries to climate change".
"No country has so many different vulnerabilities. That is why we are concerned with the prospects of survival of the Kyoto Protocol and obligations of parties," an Indian delegate said.
In the next eight days, negotiators from 192 countries gathered here for the Copenhagen Climate Change Conference are expected to hammer out a legally binding Climate Change treaty for which negotiations have been on for two years.
The overall Climate negotiations are moving under two tracks – the first is under the Bali Action Plan that requires parties to produce a legally binding treaty before the first commitment period of the Kyoto Protocol ends in 2012.
The second track is the extension of the Kyoto Protocol for a second commitment period – the only treaty under which industrialised nations have signed on to legally binding carbon emission cuts.