Wales, responding to bad reviews on launch in January 2008, said that Wikia Search was "like fine wine, in that it will get better and better as time goes by and more and more people contribute".
The search engine aimed to be a hybrid of search engine and social network, with users determining results rankings by rating them on a scale of one to five.
But now the project has been shut down by the poor state of the global economy.
"In a different economy, we would continue to fund Wikia Search indefinitely," said Wales in a blog post. "It's something I care about deeply."
He also raised the prospect of resurrecting the project in the future.
"I will return to it again and again in my career to search, either as an investor, a contributor, a donor or a cheerleader."
Users of Wikia Search are now being redirected to Wikianswers, the question-and-answer site that was relaunched by Wales in February.
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