Excite in the UK is a joint venture between the US parent and BT, which has a 42% stake in the company.
Excite UK is close to profitability on a month-by-month basis and has enough cash reserves to last at least another year, according to a spokesman.
As part of its move into Chapter 11, Excite@home has agreed to sell its broadband internet access business assets and related services to AT&T for $307m (£208.5m) in cash. The Chapter 11 filing will allow Excite@home to maintain operation of its internet access services until the sale is approved. Its high-speed internet access business has 3.6m customers worldwide.
The deal will leave the company with its loss-making content businesses, including the Excite search engine. AT&T has agreed to hire a significant number of the 1,600 staff who currently work for Excite@home.
Rebecca Miskin, managing director at Excite UK, said, "We are obviously disappointed with Excite@Home's decision to file for Chapter 11 bankruptcy and are in active discussions with potential buyers of its stake. We are confident that the Excite UK business will find a new shareholder, given its past record and current good health."
It is unclear whether BT would be willing to increase its stake in the company. If not it will prove attractive to companies such as Italian ISP Tiscali, which has recently been on a buying spree, picking up failing European ISPs.
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