The Oakfield Care Home in Edith Street, Nelson is to close, after efforts to sell the business as a going concern have proved unsuccessful.
Oakfield Care Ltd, which owned the home, went into administration in March last year.
The joint administrators were appointed by the company after taking professional advice.
Lindsey Cooper, partner at Baker Tilly Restructuring and Recovery and one of the joint administrators, said: “The decision to close the Oakfield Care Home is not one we have taken lightly.
“However, after 16 months of trying to sell the business as a going concern, we have reached the conclusion that the only option is now to close the home.
“We are working closely with Lancashire County Council, the Care Quality Commission and Goldcare Future Management to ensure the safety and well-being of all 12 residents.
“And we will be liaising with residents and their relatives over the coming weeks to ensure alternative living arrangements are found for everyone concerned.”