According to the Associated Press, Bundy has refused to pay the BLM grazing fees since 1993.
News reports from the area indicated as many as 1,000 protesters had gathered near the ranch near Mesquite to protest the federal action.
In announcing the withdrawal, BLM director Neil Kornze said a safe and peaceful operation was his agency's No. 1 priority.
"Based on information about conditions on the ground, and in consultation with law enforcement, we have made a decision to conclude the cattle gather because of our serious concern about the safety of employees and members of the public," said Kornze in a release. "We ask that all parties in the area remain peaceful and law-abiding as the Bureau of Land Management and National Park Service work to end the operation in an orderly manner."
He said that the agency had made progress in enforcing two recent court orders to remove the trespass cattle from public lands. Kornze called this a matter of fairness and equity.
"We remain disappointed that Cliven Bundy continues to not comply with the same laws that 16,000 public lands ranchers do every year," said the BLM director in the release. "After 20 years and multiple court orders to remove the trespass cattle, Mr. Bundy owes the American taxpayers in excess of $1 million. The BLM will continue to work to resolve the matter administratively and judicially."
Also on Saturday, armed militia members and others gathered near the roundup site to protest the removal of hundreds of Bundy's cattle.
Republican U.S. Sen. Dean Heller, of Nevada, issued a statement asking the crowd to leave.
The Associated Press contributed to this report.