Malaysian tribal activists who have fought for years against a planned hydroelectric dam declared victory on Tuesday, saying the state government has scrapped a project that would have flooded rainforests and displaced 20,000 tribespeople.

Since 2013 activists and local tribes in Malaysia's Sarawak state on Borneo island have blockaded jungle roads leading to the proposed dam site on the Baram river.

They say decades of government-orchestrated logging and dam-building have led to social and environmental disaster.

With elections in Sarawak expected within weeks, activists said the state government had sent them a letter stating that plans to forcibly acquire necessary land had been revoked.

"That means the dam project has been called off," said Peter Kallang, chairman of the NGO Save Sarawak's Rivers.

"The struggle to resist the proposed Baram dam has finally paid off, because now the dam is scrapped."

That could not be immediately verified, however.

Sarawak Chief Minister Adenan Satem was quoted by Malaysian media a year ago as saying the dam would go ahead. No government statement was immediately seen.

The dam would have flooded an area half the size of Singapore and was part of a controversial state government drive to use hydroelectric development to spur economic growth in one of the country's poorest regions.

Much of Sarawak is a jungle wilderness slashed by untamed rivers.

Authorities had previously declared plans for around a dozen dams, saying Sarawak must tap its massive hydroelectric potential to provide power for hoped-for investment in a nascent industrial sector.

Three dams have already been completed, at Batang Ai, Murum and Bakun, and have become lightning rods for criticism.

Activists say they will provide far more power than the state needs, and have destroyed fragile ecosystems and uprooted tribes that had made their homes in the rainforest for thousands of years.

The dam-building spree was launched by Sarawak's former chief minister Abdul Taib Mahmud, who stepped aside under a cloud in 2014 after 33 years in power.

Critics accused Taib of running Sarawak like a family business, doling out government contracts and timber concessions to relatives and friends, and disrespecting tribal rights.

He has denied the allegations.

Adenan, however, has softened the pro-dam rhetoric amid the activist campaigns and dwindling national support for Malaysia's ruling coalition, of which his Sarawak party is an important member.

The Swiss-based Bruno Manser Fund, an activist group focused on Sarawak, said it hoped "that the cancellation of the Baram dam plans will trigger a review of all mega-dam projects in Sarawak".