Worcester Warriors has been placed in administration after being suspended from all competitions immediately by Rugby Football Union (RFU).
Owners of the club missed a 5pm deadline to "evidence insurance cover, availability of funds to meet the monthly payroll, and a credible plan to take the club forward," the RFU said.
Worcester Warriors says it hopes that going into administration will help attract new buyers who can save the Rugby club.
Following its suspension from competition, the Department for Digital, Culture, Media & Sport (DCMS) announced it has placed the club into administration.
In a statement, the DCMS said: "We understand the past few months have been difficult for the players, staff and fans of Worcester Warriors Rugby Football Club.""We have worked around the clock with the club’s directors, the PRL and the RFU to explore all possible options but during this time the owners’ have been unable to secure new investment for the club."
"In order to give the club the best possible chance of survival, and to protect a significant taxpayer investment, we have today agreed to the directors’ request to place the club into administration.""We will now apply to the court to appoint administrators and will begin work to explore all possible options to protect creditors and preserve the local rugby offering in Worcester."
Administration of the club comes shortly after the RFU suspended Worcester Warriors from all competitions - including the Gallagher Premiership, Allianz Premier 15s, U18s Academy Cup and Allianz Cup with immediate effect.
Fans who gathered outside the Sixways Stadium have been reacting to the news.
The CEO for the RFU, Bill Sweeney, said they met with players and staff last week to explain why the suspension would be necessary.
In a statement, he said: "We appreciate this is incredibly difficult news for fans, staff and players. We would like to thank the staff and players who have worked tirelessly over recent weeks to enable matches to continue. "We met with players and staff last week to explain why this action would be necessary and regrettably without assurances in place we have had to take this action to protect everyone’s best interests." Mr Sweeney said: "We hope a buyer can be secured to allow Worcester Warriors and The University of Worcester Warriors to return to professional league rugby.
"While it is the responsibility of each business owner to manage their individual finances, we will look at learnings from this situation to see what regulation can be put in place to provide all parties with more financial transparency."
ITV News Central has contacted Worcester Warriors for a comment.
Speaking at Sixways Stadium, Matt Kvesic, a player for Worcester Warriors, said the suspension will not only have an impact on the club but on the community.
He said: "I'd be lying if I didn't see it coming
"But even though we knew it was coming it's still though, so we're rugby players, we want to play rugby, to not have that opportunity is pretty tough."
"I've got my fingers crossed that they come to a resolution sooner rather than later so we can get back out on the pitch."
When asked about how the past few weeks have been Kvesic said: "I think I speak on behalf of everyone, it's been tough because it's been an emotional rollercoaster because you get some good news one week and then not so good another.
"You know things looking up and the next week or even that afternoon it's bad news."
"So, it's been really tough to be positive but we were we got a really good group of players who have stuck really tight and been positive throughout the whole process."