Socceroos fans have been left devastated by the news that Australia was the first nation eliminated after its World Cup bid received just one vote.

Prime Minister Julia Gillard put words to the disappointment felt by thousands of Australians, saying the entire nation was shattered after Qatar was awarded the 2022 Cup.

Ms Gillard congratulated Qatar for winning the tournament in a FIFA executive committee vote in Zurich held this morning (AEDT).

Australia was eliminated following the first secret ballot, having secured just one vote of a possible 22.

Ms Gillard said Australia had put the "best possible bid forward" and thanked Football Federation Australia chairman Frank Lowy for his tireless efforts.

"While the nation was disappointed to not have been awarded the hosting rights to the 2022 competition, the country will continue to be an avid and active supporter of the competition," she said in a statement.

"The tireless work of Frank Lowy, Ben Buckley and the Football Federation of Australia must also be recognised."

The Federal Government contributed $45.6 million towards Football Federation Australia's bid, which she says has helped put Australia on the football world map.

"Hours of effort were put into ensuring Australia put forward a technically excellent, credible and responsible bid against enormous competition," she said.

"It is through these efforts that we came so close to the ultimate prize."

'Bitterly disappointed'

A philosophical Mr Lowy said he was bitterly disappointed by the bid's failure, but vowed to continue to grow Australian football.

"Australia, what can I say? I can only say that I'm bitterly disappointed - disappointed for you that we couldn't deliver the 2022 World Cup," he said.

"[But] the sun is coming up tomorrow morning.

"Australia is there waiting for us. There is a great future for Australia and it is a great future of our game except we lost a bit of turbo charge. We have to make up for it.

"I am not a man to lie down. This battle has been lost. There are many, many more battles to win."

Fans frustrated

Meanwhile, distraught football fans at Sydney's Circular Quay reacted with dismay after the announcement.

"Gutted, absolutely gutted," Mark Kinnear said after hearing that Qatar will host the tournament.

About 300 football fans had gathered at the live site to watch the announcement, which came just before 2:45am (AEDT).

The tension was palpable as FIFA president Sepp Blatter read out the winning bid, with many biting their nails, clutching replica World Cups or simply holding hands.

Chants of "what a load of rubbish" quickly rang out after the verdict.

"We could have put on a fantastic World Cup," Socceroos fan Daniel Sanderson said.

"I'm not sure why we've been overlooked.

"If we'd won it would've put us on the map, football-wise."

Many fans said Australia should mount another bid in future.

- ABC/AAP