Diego Forlan's 102nd minute goal ended Liverpool's hopes of a first trophy in four years as Rafa Benitez's side were denied a place in the UEFA Europa League final by Atletico Madrid on the away goals rule.
On a dramatic night at Anfield, Yossi Benayoun's 95th minute goal, which gave the hosts a 2-1 semi-final aggregate advantage, looked to have booked Liverpool a place in their third European final in six seasons. Trailing 1-0 from the first leg, Alberto Aquilani had levelled the aggregate scores with a sublime finish before Benayoun struck early in extra time.
But former Manchester United striker Forlan, whose goal gave Atletico a narrow 1-0 lead from the first leg, sent the Spaniards through to face Fulham in the 12 May final in Hamburg and left Liverpool to reflect on a fourth successive season without a trophy.
"It didn't matter who scored tonight. It was a difficult game and we knew they would come after us," said Forlan. "They played well in the first half and then we settled down. We made a mistake on their goal in extra time, but we knew one goal would do it for us."
Liverpool made two changes to their starting line-up from last week's first leg as Sotiros Kyrgiakos was replaced by Aquilani, with Javier Mascherano dropping into the back four and Ryan Babel coming in for the injured David Ngog. The deafening atmosphere at Anfield was fit for a visit from Real Madrid, never mind Atletico, who are marooned in mid-table in La Liga. Yet the longer the game stayed goalless the quieter the roar became as frustration began to seep from the stands.
After Forlan's goal had given the Spaniards a narrow advantage from the first leg, Liverpool desperately required a positive start. And they almost got it as Benayoun powered his way into the Atletico area after Dirk Kuyt's flick on. However, the Israeli's effort was kept out by keeper David de Gea.
Liverpool's followers had been warmed by the fact that Benitez's team had gone on to eliminate Lille and Benfica in the previous two rounds after losing the first legs. But without 22-goal leading scorer Fernando Torres they struggled to hurt their opponents, despite carving out a string of chances before eventually making the breakthrough.
Aquilani, before his goalscoring contribution, was guilty of firing straight at the keeper from a good position yet it was Kuyt who was guilty of the most glaring miss. The Dutchman, spearheading the attack, blazed over from close range in front after Mascherano had whipped in a 26th-minute cross. Liverpool were fortunate not to be dead and buried by then after Raul Garcia had forced Jose Reina into a fine save with a rasping long-range effort.
Daniel Agger had the ball in the net in the 32nd minute only for the effort to be ruled out by an offside flag, a decision that left home fans more restless. But just one minute before half-time Liverpool got the breakthrough they craved following Aquilani's sublime finish. Having struggled to adapt to his new surroundings since signing from Roma in August, Aquilani at least proved he knows how to find the net with a terrific 15-yard strike following Benayoun's cross.
The timing of Aquilani's first European goal for his club could not have been better. Instead of going in at the interval to muted applause, Liverpool were roared off the pitch by their jubilant fans.
But Benitez's side still had to finish the job. They were given a reminder that their work was far from complete when Paulo Assuncao went close to equalising in the 52nd minute. Liverpool's defence backed off allowing the Atletico player to have a shot from distance, Assuncao's effort only just clearing the bar.
With the scores locked at 1-1 and extra time looming, Glen Johnson was determined to book Liverpool's place in the final without the need of an extra 30 minutes. The England full-back launched a vicious 80th minute drive towards the Atletico net only for de Gea to get his hand in the way.
It was a rare chance in a tightly contested second half and, with little to choose between the two teams, it was little surprise that it required extra time to find a winner. Benayoun thought he had won it for the hosts with a fine finish from an acute angle following Lucas's ball over the top of the Atletico defence before the unmarked Forlan had the last say from close range.