The company, which is owned by TPG Capital, has 335 stores including more than 40 in Yorkshire and Lincolnshire.
Deloitte, which has been co-ordinating efforts to find a solvent deal for the business, is expected to oversee the administration of Poundworld.
Poundworld's losses widened in 2016-17 to £17.1 million, from £5.4m of losses the year before.The retailer was hit with a £5.7 million charge for onerous leases, a provision retailers make when the cost of a lease is no longer covered by the income of the store.
It is the latest blow for Britain's struggling high street, which has seen a string of retailers and restaurants shrink or collapse altogether in the face of rising costs and a squeeze on consumer spending.
Poundworld has around 350 stores across the United Kingdom, including branches at Bloxwich, the intu Merry Hill shopping centre in Brierley Hill, Hednesford, Lichfield, on the Reedswood Retail Park in Walsall, in Stafford and West Bromwich and two in Wolverhampton.
Poundworld has been losing cash for the past two years.
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The chain has a store at the Richmond Centre in Derry.
'Unfortunately, this has not been possible. It follows the collapse this year of Toys R Us UK, electricals group Maplin and drinks wholesaler Conviviality.
Administrators Deloitte have stressed that the stores will continue to operate as normal for the moment, with no redundancies.
"We believe a buyer can be found for the business or at least part of it and we are keeping staff appraised of developments as they happen".
"Despite investing resources to strengthen the business, the decline in United Kingdom retail and challenging behaviour affected Poundworld significantly".
Mothercare, Carpetright, New Look, Prezzo and Jamie's Italian, have all recently announced plans to close hundreds of outlets, putting more than 35,000 jobs at risk.