We have measured the magnetotransport properties of ultrafine single-crystalline Bi nanowire arrays embedded in a dielectric matrix. At low temperatures (T⩽50 K), the wire boundary scattering is shown to be the dominant scattering process for carriers. A reversal in the temperature dependence of the magnetoresistance was observed for wires with 65 nm average diameter relative to those with 109 nm average diameter when T⩽100 K. We attribute this difference to effects due to the quantization of the transverse momentum of the carriers, which results in a semimetal-semiconductor transition for Bi nanowires as the wire diameter becomes sufficiently small.