The U.S. Department of the Treasury reports that production of $500 bills ended during World War II. Distribution of these bills ceased on July 14, 1969. The Treasury notes that some of these bills may remain in circulation as of 2014 and are still considered legal tender.
According to the Treasury, once a Federal Reserve bank receives a $500 bill from a customer, the bank is required to remove the bill from circulation and destroy it. These bills were reportedly created mainly to facilitate transfers between banks. When the production of $500 bills ended, the production of $1,000, $5,000 and $10,000 bills ended as well.