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In the announcement, he said the effort to force a primary in August through petitions had failed.
He vowed to support state Rep. Dan Carter of Bethel, who received the Republican Party's endorsement at last month's convention, in the race against Blumenthal.
Wolf said he was seeking to give Connecticut voters an "alternative to a career politician [Blumenthal] whose 32 years of service had contributed mightily to the decline of the state," the statement said.
But "an insider-rigged convention denied us primary ballot access — so we made a decision to petition," the statement said. "Sadly we learned this week that our effort fell short, and despite the efforts and encouragement of many, we are now forced to suspend the campaign."
Wolf said other political outsiders would be unwilling to take the plunge to run for office.
"Dick Blumenthal has ruined this state," Wolf said. "He is a complete and utter failure. His tenure as attorney general contributed to the demise of this once great state, and now he is hurting the entire nation. We deserve people who want to solve real issues; people who are willing to get stuff done!"
Wolf said that Carter is someone "Connecticut can be proud of — I wish him the best in his campaign this fall."
He promised to help Republicans defeat Blumenthal, a Democrat who is serving his first term in the Senate, in the fall election.
"I will support Dan as I can, especially where I have demonstrated some strength, in fundraising," Wolf said.
He also thanked his supporters.
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