Sen. John Walsh. (AP Photo/Matt Volz, File)

Updated at 6:45 p.m.

Sen. John Walsh (D-Mont.) announced Thursday that he would end his bid for a full term, shutting down an underdog campaign that was derailed last month by allegations he plagiarized a substantial portion of a major paper he submitted at the U.S. Army War College.

In a note to supporters, Walsh said the the 2007 paper had "become a distraction" to the campaign and his service in the Senate.

"I am ending my campaign so that I can focus on fulfilling the responsibility entrusted to me as your U.S. Senator," he said. "You deserve someone who will always fight for Montana, and I will."

Walsh's decision came amid concerns from many Democrats about the impact of having a flawed candidate on the ballot -- though it sparked a new round of uncertainty about the party's prospects of holding a key seat that has long been at serious risk of falling into Republican hands.

"We all just had a hard time, I think, with the circumstances surrounding" the plagiarism controversy, said Dave Fern, the male Western District Chairman of the state Democratic Party.

Republicans need to gain six seats to win the Senate majority in November. Rep. Steve Daines (R) was already leading Walsh in the polls, even before the plagiarism allegations surfaced, and Republicans expressed confidence that he would defeat whoever Democrats nominate in place of Walsh.

"Steve Daines is one of the strongest Senate candidates in the country, was in the process of defeating Senator Walsh, and will defeat whichever band-aid candidate Democrats can persuade to get in the race," said National Republican Senatorial Committee spokesman Brad Dayspring in a statement.

The New York Times reported last month that Walsh pulled a sizable part of a paper he submitted at the Army War College titled “The Case for Democracy as a Long Term National Strategy" from a Carnegie Endowment for International Peace document without attribution. The material was mostly used verbatim. Another chunk was pulled from a 1998 essay written by a Harvard scholar.

Walsh's exit means Montana Democratic leaders will have to hastily arrange a convention where they will pick a replacement nominee. They have until Aug. 20 to do so.

Possible replacements Democrats had been bandying about included former governor Brian Schweitzer; former lieutenant governor John Bohlinger, who lost in the primary; former NARAL Pro-Choice America president Nancy Keenan; and state Sen. David Wanzenreid.

The most intriguing of those options was Schweitzer. A populist with near universal name recognition in the state and a national liberal following, he was mentioned as as possible candidate last year, when Democrat Max Baucus announced plans to retire.

But after news of Walsh's withdrawal, the former governor reiterated his decision not to run.

"I respectfully decline to seek the Senate nomination," Schweitzer said on Twitter Thursday. "Many thanks to John Walsh & I'll support whoever the next nominee turns out to be."

In a statement, Montana Democratic Party Chairman Jim Larson said he's eager to start the process of selecting Walsh's replacement, which he promised in a statement would be "open and transparent."

Walsh was appointed to the Senate in February to replace Baucus, who departed to become U.S. Ambassador to China. Before coming to Congress, Walsh was the state's lieutenant governor.

A veteran of the Iraq war, Walsh is a former adjutant general of the Montana National Guard. He made his military record a central part of of his pitch to voters, which is why the plagiarism allegations were so damaging.

Walsh's appointment to the Senate was seen as a boon to Democratic chances of holding the seat. He was already a candidate, but going to Congress afforded him more visibility to voters who were not familiar with him.

In the end, it wasn't a lack of attention that did him in.