Hull Trains has axed all its services because of the "unprecedented circumstances" amid the coronavirus pandemic.
The firm said passenger numbers had "dropped significantly" since the government lockdown came into force.
Managing director Louise Cheeseman said it was a difficult decision, but one which was necessary to safeguard the future of the business.
There will be no service from Monday until pandemic restrictions are lifted.
Hull Trains, thought to be Britain's smallest train company with about 130 staff, says it has not been offered additional financial support from the government, which franchised rail operators have.
Union bosses have told the firm they expect its workers' wages to be guaranteed "at 100%".
We are sorry to announce that Hull Trains is temporarily suspending all train services as a result of the current travel restrictions and low passenger numbers.— Hull Trains (@Hull_Trains) March 29, 2020
We will not be running any services on Monday 30 March 2020 until further notice. (1/2) pic.twitter.com/gnaGwGepg6
Ms Cheeseman said: "We have explored every avenue to try and keep trains running, but sadly it is not currently financially viable to run our services.
"We fully intend to resume operations as soon as we can."
She said she hoped passengers would understand the decision after what had been "a very difficult week".
"The move protects the long-term future of Hull Trains and our people's jobs, which is important as it will allow us to reinstate operations quickly when possible," she added.
Mick Cash, general secretary of the Rail, Maritime and Transport union, said: "This decision affects 130 rail staff around the Hull area and they must be treated as an absolute priority.
"We expect the company and the government to guarantee wages at 100% and not some reduced rate and we also expect jobs, service, pensions and conditions for these rail staff to be fully protected throughout this crisis."