Wifi is enabled? You're sure there are wifi signals in the area? (Try standing with the phone no more than a couple of inches from the router, in case the antenna became disconnected.) Probably broken wifi radio or corrupted wifi firmware.
If it only picks up your router within a few inches, the antenna contacts probably moved. (The phone could also have been near a high-powered transmitter, and the wifi radio could have been permanently deafened.) Bent contacts can be fixed, but unless you're familiar with opening cellphones, pay someone a few bucks to bend the contacts back to where they should be.)