Around 16,000 Goldtrail customers were abroad when the Greece and Turkey specialist went into administration on Friday afternoon, while a further 2,000 were scheduled to fly from the UK this weekend.
As the school holiday season gets under way, it is estimated 50,000 people booked to travel with Goldtrail could be affected over the summer months.
Authorities sought to reassure holidaymakers they could claim back money lost on bookings while alternative flights and accommodation were also available.
The Civil Aviation Authority (CAA) said it was making arrangements to fly customers home at the end of their holiday under its Atol (Air Travel Organiser's Licensing) scheme.
No outbound Goldtrail flights were running from UK airports and people planning to set off on holiday were advised to check first, the aviation regulator added.
Holidaymakers spoke of their anger and disappointment at their trips to Turkey and Greece being put in jeopardy.
Unwitting travellers checked in for a flight to Turkey on Friday night before learning just hours later that the trip was cancelled.
A Glasgow Airport spokesman said 180 passengers were due to travel to the resort of Bodrum.
Holidaymakers watched departure boards announce repeated delays before their 8.45pm flight was cancelled at around midnight.
The Glasgow Airport spokesman said: "People had checked in then the company went into administration."
Joanna Farnan and her friend Mark Mclay, who were among those who were due to fly out of Glasgow Airport on Friday night, said passengers were met by police at the departure gate and warned to hand back any duty free they had purchased.
Ms Farnan told the BBC she was "pretty disappointed" and that it would take up to 12 months to get her money back.
Mr Mclay said: "We were pretty calm at the time but obviously a bit gutted.
"It was just really a shame for families. You could tell you had parents trying to explain to them (children) why they were packing their bags up again."
In a statement issued on its website on Friday night, the CAA said: "The CAA has taken steps to protect customers booked with Goldtrail Travel Limited after the company ceased trading.
"Goldtrail Travel Ltd, trading as Goldtrail Holidays, Goldtrail Travel and Sunmar, held Atol licence 4684 and was based in New Malden, Surrey. It operated flights and holiday packages from many UK airports to Turkey and Greece. It sold mainly through travel agents.
"The CAA, under its Atol scheme, is making arrangements for customers abroad to travel home at the end of their holidays."
The CAA said those already abroad on flight inclusive holidays would be repatriated back to the UK.
"All inbound flying from Turkey and Greece will operate as scheduled over the weekend, and up to and including Monday July 19," it added. "Passengers who are due to return to the UK are advised to go to the airport as originally scheduled."
Information on inbound flights from Tuesday will appear on the CAA website later.
The CAA advised passengers who are due to go on holiday with Goldtrail to contact their travel agent.
Details on how to claim a refund will be placed on the website tomorrow, according to the CAA.
Cassie Inns, from Surrey, was due to travel to Turkey with Goldtrail tomorrow.
The 23-year-old told BBC News: "I'm very upset. It's just a nightmare.
"There's no information being given to me so really I don't know anything that's going on at all."
Goldtrail was a medium-sized independent tour operator with around 150,000 customers in total, according to Abta spokesman Sean Tipton.
"If people's summer holiday has been cancelled they would need to rebook their arrangements," he said.
"But there is still some availability in Greece and Turkey.
"If people booked through an Abta travel agent they will probably be looking into that already."
Barrhead Travel founder Bill Munro said he had long-standing misgivings about Goldtrail and said its collapse was "an accident waiting to happen".
A queue formed outside the company's office in Glasgow's Oswald Street as desperate travellers sought to book new holidays.
Last year Goldtrail was accused of putting customers up in sub-standard hotels and faced a string of complaints exposed by BBC Watchdog.
In March 2009, the programme featured customers who said they were given accommodation which had no curtains on the bedroom windows, stained mattresses and filthy restaurants.
The company was accused of writing back to some holidaymakers who complained, saying they "shouldn't expect too much from a cheap holiday".
Goldtrail defended itself against the claims saying the "majority" of its clients were happy with their holidays.
Dermot Blastland, managing director of Thomson and First Choice, said: "We have been briefing our agents up and down the country to ensure they can offer advice on how to claim a refund and how to go about booking a new holiday."
He said that although there was no guarantee the company would have identical holidays it had "pockets of availability" to Turkey and Greece over the summer.
Rochelle Turner from Which? Holiday said: "This is more bad news for British tourists, just when we thought the travel industry was back on its feet following the volcanic ash disruption.
"Once again we are reminded of how important it is to ensure you're protected in case something go wrong with your holiday.
"Those who booked with Goldtrail are covered by Atol bonding, so the CAA will be taking steps to get them home.
"Those who have booked with Goldtrail but haven't yet flown will get their money back, but this may take some time."
Goldtrail customers can call the CAA on 0203 4410846 for information.