In exchange for taking up the bill, Democrats wanted votes on amendments, including one that would have forced GOP senators to go on-the-record on Donald Trump's controversial plan to temporarily ban all Muslims from entering the U.S.
The 55 to 43 vote was largely split down party lines and fell short of the 60 votes needed for the bill to advance. The result means the refugee bill, which passed the House with broad bipartisan support in November, likely is dead for the year.
President Barack Obama had warned he would veto the bill if it made it to his desk.
"By blocking this measure, Senate Democrats are making it that much harder for us to keep Americans safe," House Speaker Paul Ryan said in a statement after the vote. "Their vote is irresponsible in a time of grave threats. Even the administration's top law enforcement officials say there are gaps in our refugee program that terrorists can exploit."
Concern about the refugees is a dominant political issue in the presidential campaign, with Trump, the Republican front-runner, leading the charge against the Obama administration program. Most Democrats back the program, which provides safe havens for thousands of people fleeing those war-ravaged countries, and bristle at what they say are attempts by Republicans to politicize the plight of the refugees.
Republicans were equally frustrated that Democrats refused to modify the program, which drew scrutiny after the recent terrorist attack in Paris and concerns that it might have been carried out by refugees from Syria. Republicans also resented the Democrats' insistence on getting votes on Trump's Muslim ban. The No. 2 Senate Republican, John Cornyn of Texas, said Democrats were trying to force the "circus" of the 2016 campaign onto the Senate floor.
"I hate to see the Democratic leader try to trivialize this very important national security debate and discussion by injecting presidential election politics right in the middle of this important discussion and debate on the Senate floor," Cornyn said.
The second-ranking Senate Democrat, Dick Durbin of Illinois, charged that Republicans ran "like scalded cats" when Democrats tried to force a vote on Trump's proposed Muslim ban.
GOP presidential candidates Florida Sen. Marco Rubio and Texas Sen. Ted Cruz returned to Washington from the campaign trail for the vote, the outcome of which was uncertain until a few hours before the vote when it became clear Republicans and Democrats couldn't agree on how to deal with amendments.
Democratic presidential contender Vermont Sen. Bernie Sanders missed the vote.
"By advancing this bill, Republicans are creating a terrible distraction for the sake of embracing the hateful rhetoric and vitriol of the Republican Party's standard bearer, Donald Trump. This should come as a surprise to no one," said Senate Minority Leader Harry Reid on the floor ahead of the vote. "Over and over again, Republicans remain committed to pledging loyalty to the divisive platform they have built for Donald Trump."
On the Senate floor Tuesday, Majority Leader Mitch McConnell urged his colleagues to advance the measure.
"It's clear that many Americans are concerned about the administration's ability to properly vet thousands of individuals from Syria and Iraq. Elected officials in both parties have expressed concerns too, as have administration officials," he said. "That's why many Americans are asking us to take a step back and press 'pause' on the program so we can ensure we have the correct policies and security screenings in place."
The bill requires the FBI, Department of Homeland Security and Director of National Intelligence all to certify that individuals from Syria or Iraq -- or a refugee who has visited one of those countries in the last five years -- is not a security threat and can be admitted to the U.S.
The Obama administration threatened to veto the bill when it passed the House in November with the support of 47 Democrats, which means it could have enough support to override a veto in that chamber. Reid said at the time he expected his caucus to block the Senate from debating the bill.
Ryan Crocker, a former U.S. ambassador to Syria, Iraq and other Mideast countries, warned lowering the number of refugees could feed the sense in that region that the U.S. has turned on Arabs, and Sunni Arabs in particular.
While he was there to express confidence in the vetting process, Olsen acknowledged he couldn't guarantee a bad actor wouldn't slip through.
"No process is absolutely perfect and there is no way to guarantee that every person who enters the country poses no threat. That's not realistic," he said. "The bottom line, from my understanding of the process now, is that if there is a doubt about the security of a person, then that person is not going to be admitted."