The dream is over for Team New Zealand.

Their challenge for the America's Cup came to an end this morning when they were beaten by Alinghi in an unbelievable race in Valencia.

Chaos reigned on the final run as the two boats crossed the line in sync but it was Alinghi who were awarded the win by a mere one second.

In what will go down as one of the closest America's Cups in history Alinghi won the best of nine race series 5-2.

Like every race this morning's was an arm wrestle around the entire course. The Kiwis led up the first beat but as they approached the top mark the Swiss pulled off a masterful move pushing the Kiwis out and sneaking round the first mark seven seconds ahead.

Downwind it was all on again as NZL92 come charging back. The Kiwis eased past the Brad Butterworth-skippered Alinghi and around the bottom gate 14 seconds ahead.

The Kiwis were unable to shake the Swiss up the second beat. Again it was all on at the top mark as Butterworth executed his second planned manoeuvre which resulted in a penalty against Team New Zealand.

While it was thought that was game over, the Swiss then botched up a gybe and the Kiwis came back. With just metres to go from the line the Kiwis charged ahead and managed to complete their penalty turn and cross the line alongside Alinghi. But they were just a second too late.

While the Grant Dalton-led Team New Zealand syndicate will feel nothing but disappointment today as time goes they will be able to reflect on what has been a remarkable campaign.

Following the disappointing 2003 defence where they were cleaned out by Alinghi 5-0, Dean Barker and his men have come back and shown why New Zealand have been in every America's Cup match since 1995.

While they made a slow start to the regatta they fought back to finish the round robin competition first. They went on to beat Desafio Espanol 5-2 in the semifinals and then trounce Luna Rossa in the final 5-0.

While many thought the Swiss would have too much pace for the Kiwis in the match, they proved wrong and NZL92 held its own against the much revered SUI100.

This America's Cup came down to sailing. The Alinghi crew headed by Butterworth and featuring New Zealanders Simon Daubney, Murray Jones, Warwick Fleury, Dean Phipps and Rodney Ardern were just too good.

Espanol were set to become the challenger of record.