Slater's Ales has been going for 27 years. It originally started as Eccleshall Brewery at the George Hotel in Eccleshall in 1995.
The brewery moved to St Albans Industrial Estate top open a 30-barrel brewery in the county town in 2005.
Brother and sister directors Andrew and Vicki Slater said it had been one of the hardest decisions the family had ever had to take.
Slater's will continue to trade through Christmas and wind down in the new year.
Its brewing equipment has been sold to Kombucha Brewery in Manchester.
The Slaters said: "Unfortunately the aftermath of Covid and the ongoing cost of living crisis has meant for us it was time to close the business down."
Slater's, whose beers include Top Totty and Haka, ran a bar in Queen Square in Wolverhampton for a few years.
The sale of the equipment will enable the business to pay all suppliers in full.
"We would like to thank all our customers, employees and competitors that have supported us over the years: we really have enjoyed our time in the industry," added the Slaters.
A number of other breweries in the West Midlands have shut in recent months including Beat Brewery in Lye and Wood's Brewery in Wistanstow, Shropshire.