Polaroid cameras can develop photos in 10 seconds
The US firm has been struggling under a debt mountain for some months, and the announcement had been widely rumoured.
Three months ago, Polaroid said it was exploring strategic options including a sale of the company, but no buyer emerged.
And market conditions have become bleaker following the 11 September terrorist attacks, forcing Polaroid to admit defeat.
A bankruptcy court judge has approved $13.1m (£9m) in emergency funds so the company can meet its payroll and pay outstanding cheques.
Fading popularity
The company's popularity was etched away after the introduction of one-hour film developing shops and video cameras.
And the firm struggled to adapt to new digital technology as its core instant film business faded.
Polaroid's financial difficulties began well before 11 September.
But a slowdown in travel - and the purchase of cameras and films - could have been the nail in the coffin of the company.
Broken into pieces
The company was founded by Harvard University dropout Edwin Land in 1937.
Total debts at the firm amount to almost one billion dollars.
Polaroid shares, which traded as high as $60 in 1997, were frozen on the New York Stock Exchange at just 28 cents last Tuesday.
In the second quarter of this year, the firm posted an operating loss of $52m.
It was due to report third quarter results next week.
Analysts say the company is now most likely to be stripped for its parts.
The firm has already received a $33m offer for its identification business, which makes licenses for state motor vehicle bureaus.
Under chapter 11 bankruptcy law, the company can continue trading while it sorts out its finances.