Rail union RMT said it was speaking to its 523 members over plans to hire security contractors on the company's trains.
London Midland told the union it stopped using contractors last month.
RMT said the decision was "a major victory", while London Midland said it was pleased passengers would not be affected by "unnecessary" strikes.
More updates on this and other stories from Birmingham and the Black Country.
The union said its national executive committee decided to cancel the strike ballot and end the dispute after receiving "written assurances" from London Midland the use of contractors would stop after 30 January.
General secretary Mick Cash said train security and passenger safety was only possible with "professionally trained and equipped" employers and "an adequate number of conductors.
"RMT remains eternally vigilant in the ongoing fight to stop the casualisation of rail workers' jobs and any moves that undermine permanent staffing arrangements," he said.
A spokesman for London Midland said it "decided to review our current arrangements" after speaking to staff.
"We all share the same objectives of improving safety and reducing ticketless travel," they said.
"Our focus now is to work together on how best to achieve this."

Bringing together the major influences that shaped the city's cultural output Beirut-based curator and designer Rana Salam pinpoints the impact of external wars and civil conflict on design with an insider's eye for detail.
The French mandate ended in 1943, after 23 years of colonial rule, ushering in the new republic. But it was in the 1950s that architecture, interior and product design flourished fusing European and Arab influences. The economic emphasis shifted from agriculture to industry, tourism and trade, creating a new skyline, and growing consumerism encouraged brand advertising.
A 1960s poster (pictured) for Middle East Airlines, Lebanon's national carrier, which began flying the newly wealthy to international destinations. The French-designed poster suggests it's made of mosaic while appearing modern, and designer Jacques Auriac - also responsible for the creating iconic French cigarette packets - conjured up posters to destinations beyond the immediate region.
Opening its doors in late 1967, the boutique L'Artisan du Liban et L'Orient was the response of May El Khoury, the wife of an eminent architect, to the trauma of defeat in the 1967 Arab-Israeli war. The defeat eroded confidence and left a profound impression on the Arab psyche. Modernising overlooked local crafts and selling them in a chic setting might be interpreted as an act of cultural activism. It softened the humiliation of military defeat for the middle classes, who were attracted to the new Arab aesthetic and to the idea of patriotism through ethical consumerism.
The desire to create a contemporary Islamic architecture marked architect Assem Salam's early career in reaction to the 1967 war. Along with Pierre Khoury he felt the construction of specifically Lebanese-Arab religious buildings would revive spirits crushed by the defeat and designed the Khashoggi Mosque (pictured above). After the civil war he founded an association for the preservation of historic buildings seeking to slow down the rush to reconstruct Beirut at the cost of cultural heritage.
The nightclub known as B 018 was designed by Bernard Khoury in 1998 in the Quarantaine, the Beirut neighbourhood that saw some of the worst atrocities during the conflict. It has its roots in the 1980s in the thick of the civil war when gatherings were held at a semi-secret location code named B 018.
The circular lid covering the subterranean club looks like a helicopter landing pad from above. The lid can also be raised revealing activity below. Khoury claims that in the absence of public spaces above ground his club was designed not for entertainment but to bring people together for therapy.
The Egg, a scarred reminder of the civil war, stands near Martyrs Square. It was originally planned to be a cinema at the heart of the largest leisure and shopping complex in the Middle East, part of a modernist, avant-garde architectural movement, but it was unfinished when the civil war broke out in 1975. Fierce fighting around the building left the edifice pock-marked but still standing. This iconic building occasionally hosts cultural events.
The Basilica of the Cathedral of Harissa, designed by Pierre Khoury, is pictured at the top of the page. It stands on a hill overlooking a bay, next to an important Lebanese Christian pilgrimage site. The remarkable religious building was conceived with the idea of creating a stronger Christian identity after the 1967 war.
Train conductors have called off balloting for strike action on London Midland's service.
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The main exhibition at this year's Dubai Design Week, Iconic City: Brilliant Beirut, presents a cleverly conceived display of the Lebanese capital's design evolution from 1950 until the present.