SOUTH LAKE TAHOE, Calif. — The U.S. Forest Service announced a deal Wednesday to keep one of the last privately owned wild stretches of Lake Tahoe’s North Shore out of development.

The deal means private owners Sierra Pacific Industries and Mountainside Partners resort developers would shelve plans to create a sprawling campground on the 120-acre parcel, and sell the land to the U.S. Forest Service instead.

A citizens’ group, the League to Save Lake Tahoe, says the campground would have worsened traffic and pollution at the lake, already suffering from the traffic jams and car exhaust of millions of visitors annually.

“We have listened carefully to the community and have decided that the parcel should be permanently protected” through sale to the forest service, Blake Riva, the managing partner of Mountainside Partners, said in a statement.

The 120 acres were one of the largest remaining undeveloped stretches of privately owned forest in the Lake Tahoe basin, said Jeff Marsolais, forest supervisor in the basin. Millionaires and billionaires from California’s tech industry are among those building lavish third- and fourth-homes along the Tahoe shore in recent years.