Sales of electronic cigarettes have fallen sharply in recent months, bringing an end to five years of triple-digit growth and making the much-touted category look more like a potential fad than real threat to Big Tobacco.

Growing dissatisfaction among customers, inventory backlogs, new state laws and rising safety concerns are expected to cut the rate of e-cigarette growth in half next year to 57% from its compound annual growth rate of 114% over the past five years, according to the research firm Euromonitor International....