It's happened to the best of us: a project went too far out of scope, or became too expensive, or was behind on delivery, and it ultimately failed. The situation is always unsettling, but even more so when inquired about in an interview. The fortunate truth is that your interviewer is less interested in the actual failure than they are about learning how you deal with stressful situations. Set up the story with what happened. Be as brief as possible and try to pick a story from something that happened a long time ago. Then, detail what you did in the situation.