Bidding for St Stephens church - built in 1888 and located in a rural setting near Strathfieldsaye - started at $108,000, with two people vying for it.

However, when it became clear the two parties weren't prepared to bid any higher than $200,000, Elders auctioneer Martin Skahill halted the auction to speak with the vendor who put in a bid of $240,000.

This bid was not topped and the church was passed in.

Anglican Diocese of Bendigo general manager Anne Baker, who was representing the church, said she was disappointed the building didn't sell but was hopeful it would attract higher offers throughout the coming week.

"We were expecting higher bids but we're not in any sort of hurry (to sell it)," she said.

"We'll see what happens in the next week or so.

"We're still committed to selling the property."

She said it made sense for the church to sell the building, because the congregation was merging with the nearby Strathfieldsaye Uniting Church, which will soon change its name to the Strathfieldsaye Community Church.

"Traditionally church was a big part of people's lives on a set day and time but gatherings are evolving," she said.

She said while people used to travel by horse and cart, the use of cars meant getting to Strathfieldsaye from Emu Creek was a short journey.

But parishioners Tom McClean and Len Cooper said they were disappointed the church was being sold.

Mr Cooper's parents got married in the church in the 1920s and he has been attending the church since birth.

Mr Cooper's son made the crosses that adorn the church today.

Mr McClean said Emu Creek had lost many community buildings in recent times.

"We lost the post office, we lost the school and now the church," he said.

The redbrick church sits on one hectare of land, surrounded by the bush.

It has two adjoining buildings, including a small kitchen, but no gas, electricity or plumbing.

Mr Skahill described the building as being in a "remarkable condition, despite some failings", and set in "quiet peaceful surroundings".

He said a potential buyer could unleash their imagination in deciding how to renovate the heritage-listed building.