According to wikipedia:
ABC announced the cancellation of
Police Squad! after four of its six episodes had aired in March 1982. The final two episodes were aired that summer. According to the DVD commentary for "A Substantial Gift" (Episode 1), then-ABC entertainment president
Tony Thomopoulos said that
Police Squad! was canceled because "the viewer had to watch it in order to appreciate it," meaning that the viewer had to pay very close attention to the show in order to get much of the humor, while most other TV shows did not demand as much effort from the viewer. In its annual "Cheers and Jeers" issue,
TV Guide magazine called the explanation for the cancellation "the most stupid reason a network ever gave for ending a series."
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Matt Groening, creator of
The Simpsons, has said, "If
Police Squad! had been made twenty years later, it would have been a smash. It was before its time. In 1982 your average viewer was unable to cope with its pace, its quick-fire jokes. But these days they'd have no problems keeping up, I think we've proved that."