Withdraw manuscript from peer review after finding a major error I just received a major revision decision (1st round) for a manuscript I submitted to a reputable journal.  After looking into one of the reviewer's comments I found a major error in my analysis.  The conclusions of my research are almost completely different as a result.  I also don't think the reviewer realized the severity of the error.

I would like to withdraw my manuscript from the journal because of the major error.  However, I don't know how to approach my co-authors or the journal about this issue.  I've always been able to complete major revisions for other papers I've written, and so I've never had to deal with this type of problem before.  I also realize that the editors and referees have already put a lot of time into reviewing my paper.  

I would like to ask this forum for any suggestions about withdrawing a paper once it's in review.  I don't know how common it is to do this, and how it is generally perceived in academia.
There are two parts to your question:


  
  How to broach the matter with your colleagues.
  How to withdraw your paper from review.
  


The trickier issue is how to broach the subject with your colleagues. If you feel there is absolutely no way for you to finish the revisions on schedule, then you owe it to your co-authors to tell them of the problem. However, this should be a dialogue, not a unilateral decision. They may see the issue as being less onerous timewise, and that it may be possible to finish the work within a reasonable period of time. Or they may agree with you that withdrawal is the best option. In either case, it should be a team decision, and once that's made, you can proceed with notifying the journal.

Notifying the journal is the simpler issue to handle. Most journals usually set a timeline for submitting major revisions. Just send the journal a note stating exactly what you wrote above. There is nothing wrong with independently withdrawing a paper because of significant errors. (Better that you do so now than need to retract it because of errors later on!)