The two parole board members hearing Drabinsky's case couldn't agree on whether he should be allowed to live with his wife rather than at the Toronto halfway house where he has stayed since his release on day parole last year.
That means he will have to make his case to another parole board panel at a hearing to be held within two months.
Drabinsky appeared downcast on hearing the news at the end of an emotional four-hour hearing.
The panel didn't give reasons for the split decision, but both members had raised concerns about Drabinsky's current work as an entertainment consultant.
Since his release, Drabinsky, 64, has been employed by a company set up in the trust of his wife and children, according to parole board documents.
"The concern that we have... is some of what you're doing now is what you were doing before and we need to know if it's related to the offence cycle," said Louise Harris, the lead panel member.
Details of Drabinsky's work and the companies that have retained his services weren't disclosed to preserve confidentiality, but his role as a consultant was under the microscope as the board tried to assess whether he could be putting himself at risk of breaching his parole conditions.
The ex-CEO of the now defunct Livent Inc. — the company behind "Phantom of the Opera" and other big-stage productions — is prohibited from owning or operating his own business or managing money for any other individual, company or charity.
He also cannot contact any of his co-accused, including his longtime friend and business partner Myron Gottlieb.
The panel cited a June report by the Correctional Service of Canada, which warned the former impresario's ambition and desire to re-establish himself in the entertainment industry could lead him to intervene in the management side of certain projects.
Under questioning, Drabinski repeatedly told the panel he would never again find himself embroiled in the type of scheme that led to his arrest and conviction.
"There is nothing on this Earth to move me to do something that would affect my liberty ever again," he said.
"I don't want to be involved and can't be involved in anything that even smells of impropriety."
Drabinsky's parole officer also told the panel he is considered to have a low risk of recidivism and a high potential for reintegration into society.
Still, the panel found his work has changed drastically in recent months, which they said sounded "alarm bells."
Drabinsky said his first consulting contract had him advising a company on advertising and marketing matters for roughly six months.
A second contract with another company saw him assess projects under development, largely documentaries, he said.
That job recently took an unforeseen direction when Drabinsky came across a nonfiction book that "cried out to be made" into a television miniseries, and he assisted in acquiring the rights to it, he said.
He has also been working on a month-to-month basis with two connected companies, advising them on what he described as artistic and marketing issues as well as theatre design.
That could turn into a longer-term contract if a tentative arrangement is approved, he said.
So far, Drabinsky's work is the sole source of revenue for the trust, and he still relies on financial support from family and friends on top of his salary, he said.
He and Gottlieb were convicted in 2009 of fraud in a book-cooking scheme that eventually led to Livent's bankruptcy.
The demise of the publicly-traded company ultimately cost investors an estimated $500 million.
Last May, Ontario's law society said it was taking steps against Drabinsky that could result in him losing his licence.
Drabinsky had agreed not to practice law but told the panel Monday he would like to retain his licence and work in entertainment law.