The clubs had agreed for the 19-year-old midfielder to head to the Proact Stadium as part of the transfer of Ched Evans to Bramall Lane last month.
According to Spireites director Ashley Carson, United sent the paperwork for the loan over to Chesterfield, which was signed and sent back.
However, Sheffield United did not sign off on the deal and have now informed Chesterfield that Brooks will not be joining them because manager Chris Wilder wants to assess him further in pre-season training.
Carson is quoted by Sky Sports News as saying: "We had a verbal agreement in place and the paperwork for the loan was completed at our end, so we expected David Brooks to join us once he had returned from Toulon.
"We were looking forward to welcoming the player to the Proact but Gary Caldwell will now have to bring in another midfield player to take his place.
"Sheffield United have their reasons for reneging on the agreement and there is nothing we can do about it, unfortunately."