A Nauru-based regional airline has flown into strife, cancelling the only service linking the isolated Marshall Islands in Micronesia with the South Pacific.

The Our Airline service linking the Marshall Islands capital Majuro with Brisbane would be cancelled from July, chief executive Geoff Bowmaker said on June 7.

A mechanical problem with its sole Boeing 737 aircraft also forced the cancellation of its flight on June 5, stranding more than 10 passengers for over a week.

Among the stranded passengers was a Fijian government delegation attending a regional UN conference.

The airline, relaunched last year after Taiwan paid for the purchase of the aircraft, is in trouble because Fiji has denied it landing rights which its predecessor Air Nauru had for 25 years.

"The Fiji route provided an inter-island through service that was of great benefit to the people of the Solomons, Nauru, the Marshalls and Kiribati," Mr Bowmaker said.

"This announcement to withdraw from Majuro is a direct consequence of not being able to operate that through service."

The Marshall Islands service has proved unviable without the link to Fiji, a hub for Pacific island services.

The loss of the Our Airline service means the only remaining international service for the island nation of 60,000 will be a Continental Micronesia flight linking the country with Guam and Hawaii.

Our Airline was started up by the impoverished island state of Nauru, with help from Taiwan, after the collapse of Air Nauru at the end of 2005 when its aircraft was repossessed.