It stays and people can actually search through it but you won't be paid for the clicks through those searches. The best thing that happened to me was when my AdSense account was disabled. I was paid every last penny though. They disabled it because they didn't like my business structure. AdSense ads look ugly, make any website look ugly and they actually hinder sales if you have a website that sells stuff. Why would anyone want to distract their visitors from their site for a few pennies when they can make several dollars from the same visitors?
Though adsence search is still there, the revenue will go to google and you don't have a share anymore....