The entertainment retail chain has become the third major UK retailer to collapse this year.
It has been reported that Blockbuster management had already begun plans to close down a number of its stores across the UK over the next six months.
Blockbuster is said to be overburdened with current stock and has largely been unable to source new releases across its entertainment platforms.
The news follows the news earlier this week that fellow entertainment retailer HMV has entered administration after struggling to meet the debt covenants agreed with lenders.
Deloitte, who are already managing the administration process for HMV, has today been appointed administrator for the retailer.
Lee Manning, joint administrator of Deloitte, said: “We are working closely with suppliers and employees to ensure the business has the best possible platform to secure a sale, preserve jobs and generate as much value as possible for all creditors."
"The core of the business is still profitable and we will continue to trade as normal in both retail and rental whilst we seek a buyer for all or parts of the business as a going concern.
However, unlike HMV, it is reported that Blockbuster will continue to accept gift vouchers and store credit.
"During this time gift cards and credit acquired through Blockbuster’s trade-in scheme will be honoured towards the purchase of goods."
Blockbuster operates over 528 stores in the UK with 4,190 staff.
Want to receive up-to-the-minute tech news straight to your inbox? Then click here to sign up for the completely free PCR Daily Digest and Newsflash email services. You can also follow PCR on Twitter and Facebook.