WASHINGTON – Flyi Incorporated, parent of the Dulles, Va.-based, low-fare airline Independence Air, said yesterday it will discontinue flights after Thursday evening because it could not find a buyer for its financially troubled operation.

The demise of Independence Air, whose blue and white jets became a familiar sight in the skies around Dulles International Airport, will leave 2,800 employees out of work and thousands of passengers scrambling to find alternate flights and secure refunds. It also will cut competition in the 37 markets Independence serves, and that may lead to higher fares at Dulles and beyond.

The shutdown will come two months after Flyi filed for Chapter 11 bankruptcy protection, complaining of high fuel costs and intense competition, and almost 19 months after the carrier launched service, promising low fares and coast-to-coast flights.

“Today is a sad day for Independence Air,” the airline’s Web site said yesterday in a message to passengers. “The financial pressures in the industry have prevailed. We have run out of time.”

Independence began service on June 16, 2004, and once offered 600 flights a day to 47 cities. Today, it offers fewer than 200 daily departures to its 37 destinations.

Flyi said it is seeking the approval from the U.S. Bankruptcy Court in Delaware to issue refunds to customers who have booked flights scheduled to depart after 7 p.m. Thursday.

Travelers holding Independence tickets for those flights must be accommodated on a standby basis for $50 one way by airlines that serve the same routes. That provision was in a law passed by Congress to protect consumers after the September 11, 2001, terrorist attacks. Flyi said passengers must book these alternative flights within 60 days after the carrier goes out of business.

Independence said it will halt service after its Flight 1777 arrives at Dulles from White Plains, N.Y., on Thursday night.

Independence’s frequent flier points will become worthless at that point, but passengers can file claims with the bankruptcy court, the airline said.

The shutdown was expected.

Flyi warned as early as last winter that it may have to file for bankruptcy protection if it could not successfully restructure its operation. All last year, though, the airline held out hope that a solution to its financial problems could be found. But the company declared in its bankruptcy filing November 7 that it would shut down if it could not find a buyer by January.

On December 23, Flyi sent a letter to employees warning it would cease operations on January 7 if it was unable to find a major investor or buyer.

At least two airline companies had expressed interest in bidding for Flyi’s assets. One potential bidder was Mesa Air Group Incorporated, a Phoenix based regional carrier that tried to acquire Flyi two years ago. The other was its former partner, UAL Corporation, parent of United Airlines. From 1989 to 2004, Flyi, then known as Atlantic Coast Airlines Holding Company, operated as a feeder carrier for United, the nation’s second largest airline.