Organisers of the Galway 2020 European Capital of Culture say all but skeleton staff are to be temporarily laid off.
They say this was due to the enforced contraction of its programme due to the coronavirus pandemic.
The event is implementing a three-week temporary layoff programme for "all but a skeleton staff", effective from Tuesday.
It is also ending its contract with British-based creative company Artichoke.
Organisers say: "We have also made the very difficult decision to bring to an end our contract with Artichoke.
"We are very disappointed to have had to make these decisions.
"Galway 2020 wishes to acknowledge and thank all staff and in particular creative director Helen Marriage and the team at Artichoke for their hard work and commitment to Galway 2020.
"Helen, working with the Galway 2020 team, had curated an extraordinary cultural programme of events, which would have provided many amazing cultural moments and experiences for local people across Galway city and county."
In response to the unprecedented nature of this crisis, the board of Galway 2020 says it has been working in recent days and weeks to make important decisions about the future of the programme.
Chairman Arthur Lappin says: "We are mindful of the mission which has underpinned Galway 2020 from its inception - to mount a programme that will celebrate the creativity for which Galway is renowned."
"Circumstances arising from the coronavirus emergency pose us significant new challenges, financial and temporal, which will inevitably give rise to undesired and painful alterations to our plans.
"We will exercise our responsibilities in a conscientious and effective manner within the resources and constraints imposed on us.
"It is important to state that decisions we take now are the only course of action we can responsibly take in the current circumstances."
The board says it will continue to consult with stakeholders in the coming weeks to make longer-term decisions.