The Texas senator's announcement leaves front-runner Trump, 69, and John Kasich as the remaining Republican candidates for president.
CNN reports that with 17 percent of the vote in, Trump was the projected winner in Indiana with 53.7 percent of the vote to Cruz's 35 percent, while Kasich was at 8.6 percent.
"With a heavy heart but with boundless optimism for the long-term future of our nation, we are suspending our campaign. But hear me now, I am not suspending our fight for liberty," Cruz, 45, told supporters in Indianapolis on Tuesday night with his wife, Heidi, by his side.
In an appearance on Tuesday morning in Indiana, Cruz had made a final appeal for voters to support him, calling Trump a "pathological liar" and "utterly immoral."
With the former Apprentice star's win in Indiana, the real estate mogul is within 200 delegates of the number he needs to clinch the Republican nomination.
Taking the stage at his headquarters in New York City on Tuesday night, Trump described Cruz as "one hell of a competitor."
On the Democratic side, Vermont Senator Bernie Sanders was predicted to be the winner in Indiana, edging out former Secretary of State Hillary Clinton.
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