An official statement from MGM is still pending, but Gateworld is reporting that Stargate Atlantis will be brought to a close at the end of its fifth season.
Reportedly the season finale, "Enemy at the Gate", which is due to air in January 2009, will end on a cliffhanger. But, much like SG-1 before it, the story will be continued in a series of spin-off movies.
MGM have stated that they'll be releasing an official press release on Thursday regarding the cancellation - we'll bring you more news as we have it.
Update: MGM has now released a press release confirming the end of Stargate Atlantis, and also that they have greenlit a two-hour movie to follow on from the end of the fifth season. The film, which is as yet untitled, will have an exclusive premiere on SCI FI, followed by a DVD release. Apparently the success of The Ark of Truth and Continuum have made the film format particularly attractive to the showrunners, with co-creators Brad Wright and Robert C Cooper saying that the movies "have shown us the opportunities that the movie format offers. We have plans for both SG-1 and Atlantis to remain vital as we expand the franchise." The full press release can be read here .