How does a government’s initiative to terminate an industry influence research and development (R&D) organizations in the related sector? Exploiting a unique event in Korea, this paper documents how research-focused organizations are susceptible to the government’s termination initiative for the related industry. Following the sudden regime change from the Park Geun-hye to the Moon Jae-in administration and the new government’s announcement of the initiative to eliminate nuclear power plants in Korea, R&D grants in the nuclear sector resulted in 8.6% fewer research papers, relative to R&D grants in other engineering sectors. Such a change was muted for patent outcomes. The effects were primarily driven by basic research in university and government-funded laboratories, especially those located in the research hubs in Korea, i.e., Seoul and Daejeon. These effects were not directly linked to the termination of nuclear plants, as evidenced by the absence of significant changes in research activities in geographical locations close to existing nuclear plants. Instead, this paper provides evidence that the effects attribute to R&D organizations in the nuclear sector i) reducing research efforts, ii) decreasing investment in new research equipment, and iii) decreased next-generation researchers (i.e., those with master’s degrees) participating in the research. These results suggest that the decrease in journal publications in the nuclear sector may be attributed to the demotivation of both current researchers at R&D organizations and prospective researchers.