Why did Buddhism nearly become extinct in Sri Lanka? I read when the British came to Sri Lanka (Ceylon) during the colonial era, Buddhism was virtually extinct in Sri Lanka and has degenerated into very low forms of superstition. However, because some Sri Lankans wanted to stop British Christianity, they requested the Burmese Sangha to reinstate a Sri Lankan monastic Sangha. I read some intellectual Sri Lankan laymen had debates with Christians, where both sides (logically) accused the other side of superstition. 

Why did Buddhism become virtually extinct in Sri Lanka? Was that 'extinction' somehow related to the form of Buddhism or how it was practised, or something else?
I have quoted 3 sources below on this topic.

Basically, it says that in Sri Lanka and other Theravada countries, people who lived over 150 years ago, thought that even stream entry was no longer possible because in-depth understanding of meditation had been forgotten. They felt that it's better to practise virtues and make merit, while waiting for the next Buddha, Meteyya or Maitreya to come and show them the path to Nibbana. Supposedly, even Buddhaghosa, who authored the Visuddhimagga around the 5th century CE in Sri Lanka, held this view.

However, Buddhist meditation practices (based on the Satipatthana Sutta and Visuddhimagga, as well as other suttas) started to be revived in Burma as a popular movement, over a hundred years ago, and then spread to other countries including Sri Lanka. This seemed to have reinvigorated the faith of Theravadins (both monks and lay people) in the possibility of stream entry and enlightenment.

Here, Buddhism did not become extinct in Sri Lanka, but people simply lost faith in the possibility of attaining even stream entry, until Buddhist meditation was reintroduced to them from Burma.

In the Broken Buddha book, S. Dhammika wrote:


  In Sri Lanka it is widely believed that it is not possible to become
  enlightened anymore and it’s not just simple folk who believe this
  either. I once attended a talk by the famous Narada Thera of
  Vajirarama in Colombo during which he said that it is  even 
  impossible  to  become  a  sotapanna  today.  Richard  Gombrich  found
  this  same  idea  to  be widely  held  in  Sri  Lanka.  ‘The 
  comparative  rarity  of  meditation  is  closely  connected  with  the
  widespread belief in the  decline of  Buddhism. A  village  girl said
  that in a Buddha-less period one must  keep  trying,  but  only 
  limited  progress  is  possible.  It  is  further  believed  by  the 
  majority  of monks,  at  least  those  whose  general  attitudes  can 
  be  described  as  traditional,  that  the  sasana  has already 
  declined  so  far  that  it  is  no  longer  possible  for  men  to 
  attain  nirvana.  This  opinion  is  very prevalent  among  the 
  laity...One  monk  even  specified  that  till  (Metteyya)  comes  it 
  is  not  even possible to become a sotapanna. The last arahat is
  commonly said to have been Maliyadeva (1st cent B.C.E).  Others  say 
  that  there may  still  be  human  arahats,  but  it  is  unlikely 
  and/or undiscoverable ....
  
  I have heard these same views expressed a thousand times in Sri Lanka.
  Even Buddhaghosa did not really believe that Theravada practice could
  lead to Nirvana. His Visuddhimagga is supposed to be a detailed,  step
  by  step  guide  to  enlightenment.  And yet  in  the  postscript  he 
  says  he  hopes  that  the merit  he  has  earned  by  writing  the
  Visuddhimagga  will  allow  him  to  be  reborn  in  heaven,  abide
  there  until  Metteyya  appears,  hear  his  teaching  and  then 
  attain  enlightenment.


In Encyclopedia of Buddhism (editor: Robert E. Buswell, Jr.), it is written:


  By the tenth century C.E., vipassana meditation appears to have fallen
  out of practice in the Therevada school. By that time it was commonly
  believed that the religion of Gautama Buddha had so declined that
  liberation  through  insight  could no longer  be  attained until the
  advent of the future Buddha Metteyya (Sanskrit,  Maitreya)  many  eons
  from  now.  In  the  early eighteenth  century,  however,  renewed 
  interest  in  the Satipatthana Sutta (Discourse on the Foundations of
  Mindfulness)  led  to  a  revival  of  vipassana meditation in Burma
  (Myanmar). After encountering initial resistance,  the  practice  of 
  vipassana was  endorsed  by  the Burmese sangha and embraced by the
  royal court.
  
  By the late nineteenth century, a distinct praxis and organizational 
  pattern  had  emerged  that  set  the  stage  for the modern vipassana
  movement of the twentieth century.  Led  chiefly  by  reform  minded 
  scholar-monks,  a variety  of  simplified  meditation  techniques 
  were  devised based on readings of the Satipatthana Sutta, the
  Visuddhimagga (Path to Purification), and related texts. These 
  techniques  typically  follow  the  method  of  bare insight.
  
  The 
  teaching  of  vipassana also  prompted  the development   of   new
  Buddhist   institutions   called wipathana  yeikthaor  insight 
  hermitages.  Initially  attached to monasteries, these evolved into
  independent lay oriented meditation centers. A related development was
  the rise of personality cults devoted to the veneration of 
  prominent   meditation   teachers   as   living arhats. In terms of
  impact, the popularization of vipassana represents  the  most 
  significant  development  in Burmese Buddhism in the twentieth
  century.
  
  Thailand has also witnessed a revival of vipassana practice in the
  modern  period,  and  both  Burmese  and  Thai  meditation  teachers 
  have  been  instrumental  in  propagating vipassana in Sri Lanka,
  India, and the West.


In Meditation en Masse, Erik Braun wrote:


  These days many assume that Buddhism and meditation go hand in hand -
  sometimes they are even considered to be one and the same. But even
  counting Theravadins, progenitors of the massively popular insight
  meditation (Vipassana) movement, relatively few Buddhists historically
  have ever understood meditation to be essential. On the contrary,
  instead of meditating, the majority of Theravadins and dedicated
  Buddhists of other traditions, including monks and nuns, have focused
  on cultivating moral behavior, preserving the Buddha’s teachings
  (dharma), and acquiring the good karma that comes from generous
  giving. To be sure, such folks have recognized the critical role
  meditation plays in awakening—in the Theravada view, you cannot become
  enlightened without such practice—but they have not doubted that one
  can live a worthwhile and authentic Buddhist life without meditating.
  Aiming not toward awakening but toward a good rebirth, many
  Theravadins have even argued that meditation is inappropriate in our
  degenerate age, except perhaps for a rare few living in the isolation
  of jungles or mountain caves. Where, then, did this now pervasive idea
  come from that meditation lies at the heart of Buddhist life?
  
  This question brings us to Burma just over a century ago. Prior to
  this time, no trend toward widespread meditation had developed
  anywhere. It is true that Thai forest masters, above all Ajaan Mun
  (1870–1949) and revivalist figures in Sri Lanka such as Dharmapala
  (1864–1933), played an important part in the establishment of insight
  practice and sounded the call for lay meditation. But they did not
  spark any broad-based movements. One must look instead to Burma to
  account for the ascendance of meditation to a popular
  practice—specifically, that of insight meditation. The Vipassana view
  understood meditation as the logical and even necessary application of
  a Buddhist perspective to one’s life, whether lay or monastic. The
  rise of this practice, however, was not strictly an indigenous
  development. It came into being specifically through colonial
  influence. (In fact, no current tradition of insight practice can
  reliably trace its history back further than the late 19th or early
  20th century.) Though now a global movement, insight practice had its
  start in a moment of interaction between a Western empire and an
  Eastern dynasty. Indeed, one could go so far as to pinpoint its
  origins to a particular day: November 28, 1885, when the British
  Imperial Army conquered the Buddhist kingdom of Burma.