The World Internet Forum (Wif) - founded by Derek Wyatt, Labour chairman of the parliamentary Internet group, and launched in 1999 - has collapsed with debts of about £830,000.
At its launch two years ago Wif was heralded as the world's first global summit to unite business and politicians in a bid to improve Internet use by government and industry.
The first three-day forum was due to take place in London last November but it was cancelled after only a fraction of the expected delegates signed up.
Industry leaders and suppliers said the government forum failed to offer IT professionals anything new or practical.
"The market had moved on by the time it was launched," said Jim Norton, head of e-commerce policy at the Institute of Directors. "People had been evangelised and got the message about e-business. They wanted to know how to build it and about their supply chain."