Search teams failed to retrieve the fuselage after three days of attempts using a lifting bag.
Officials initially thought bodies were inside, but now say recovering the wreckage is not a priority as they believe no victims remain.
So far only 70 bodies of the 162 people who were on board have been found.
The recovery operation has been hampered by stormy weather.
Indonesia's military chief, Gen Moeldoko, told the BBC that the wreckage was too fragile to be lifted.
He added that he had decided to pull troops back to their base after some of the divers involved in the operation were treated for decompression sickness, the BBC's Alice Budisatrijo reports.
It comes after a previous attempt to raise the plane on Saturday failed when the fuselage began to break into pieces.
AirAsia flight QZ8501 was flying from Surabaya in Indonesia to Singapore when it plummeted into the sea on 28 December.
A preliminary report on the crash is expected to be filed this week, although the full investigation will take months.
On Friday divers entered the main section of the fuselage, which is at a depth of 30m.
The plane's cockpit voice recorder and flight data recorder were found earlier this month.
Information retrieved from the recorders showed that the jet had climbed too fast, causing it to stall, according to Indonesia's Transport Minister Ignasius Jonan.
Source: BBC