Kyle, the titular character of Kyle XY, was on his way to learning who he was, why he had no memories, and why he had no belly-button. Unfortunately, just as his search was getting good in the middle of the third season, ABC Family announced the show wouldn’t be renewed. That meant the big season-ending cliffhanger — the realization that Cassidy was Kyle’s real father — was the last anyone would ever see of this show. That’s like making Empire Strikes Back and refusing to follow it up.
As for why they canceled it? Matt Dallas, who played Kyle, explains in his blog the show fell victim to the biggest art-killer of all: money. As he explains, “Kyle XY’s ship was sinking under the weight of its own costs with decreasing viewers to bail it out.” The show cost too much and not enough people watched it. It’s a cold, strictly businesslike tale as old as time. If you want a general idea of what might have happened, the Season 3 DVD (and YouTube, conveniently) has a 12-minute featurette called “Kyle XY: Future Revealed,” where writers and producers talk about what they had planned for Season 4. It’s not the same as actually watching a story unfold, but it’s better than nothing.