"We are very disappointed and we know the public will be too," Mr Ellis said.
"We believe the item was offered for sale in good faith, but our inquiries have shown that the singlet is not the one worn by Peter Snell at the 1964 Tokyo Olympic Games," said Mr Ellis.
"Cordy's is a reputable auction house and I know they are as saddened as we are at this outcome," Mr Ellis said.
The singlet would be returned to the vendor and no payment would be made by Te Papa.
Snell winning gold, left, vs the singlet pictured by Cordy's Auctioneers.
Mr Ellis said that Te Papa would ask an independent expert to review the process that led to the auction bid, to understand what could have been done differently.
"We have a thorough process for acquisitions, and we need to review what occurred in this instance."
Auctioneer Andrew Grigg is "devastated" to discover it's not the singlet Snell wore at the 1964 Olympics.
He said the singlet's provenance was checked and there was "no inkling" that it wasn't the real deal.
"The vendor is devastated, we are devastated. Te Papa has checked it out and it's not right. I can see it's not right," he told the Herald.
"It's got age, it's got real old elements to it. But it's been proven to me that it's not the one he wore when he won double gold in '64."
Mr Grigg said everyone entered into the sale in good faith.
Police charges are not something he would consider.
"It's not someone trying to pull a swifty on us. You look at it, you do your due process on it and it stacks up," he said.
"But when Te Papa have been very thorough and I can see from what they've told me, it is not right. it's not the one, and it has to be the one. End of story.
"The real one is out there. If someone was to find the real one, I'd happily sell it and give all the commission to Peter Snell's charity, Parkinson's New Zealand."
He didn't believe it was a fake.
"My best guess is maybe it was put together around that period, perhaps as a fundraiser. I still believe elements of it are right."
Mr Grigg said authenticated such items come with challenges.
"When we look at a Lalique vase, we know whether it is real or a fake. We look at a diamond, we can test it, and we know," he said.
"But when we look at something like this, it's a bit more esoteric. We don't just accept that it's real, we look at it and we can see the age, see that it's got the right feel, compare it online with the numbers, but it's nothing like taking it out of the frame and doing a more detailed analysis."
Peter Snell says he has no idea where his singlet from the Tokyo Olympics is.
Speaking from Texas, Snell said it was a surprising development. And despite the unexpected twist, the champion runner is looking on the bright side.
Speaking from his home today in Texas, Snell said he did not know much about what happened.
"My reaction is, if it's true, then the real things got to be around somewhere. Secondly, it seems to be a pretty elaborate fate, if you like, if it indeed is. So I will be interested to see what the evidence is that caused them to say that. Thirdly, they've saved themselves $120,000 which might be a good thing.
"I'm sort of in one sense disappointed that a piece of my apparel is not going to be in Te Papa, and on the other hand, it may be that it will show up some time, and hopefully the person who has it will donate it."
Snell said he was also shocked to hear that his singlet was a fake.
"It's pretty hard to believe isn't it? I'm not sure what they do to establish that, where they compare it with other singlets. Some of these forensic people are pretty clever, so I'm looking forward to them sharing it some time. I don't know what the reasoning is for it, so yeah, I am shocked."
Snell said he would have given the original singlet to a charity auction many years ago, and has no memorabilia left for himself. "That's what's happened to just about all the apparel. I've actually no apparel left from the Olympics or British Commonwealth Games; blazers, tracksuits, or singlets or anything like that. I have a shoe from the Rome Olympic Games. It was made by Arthur Lydiard of all people - my coach who was a shoemaker by trade.
"The amount of money that the museum was prepared to pay or had to pay in order to get it, and they were prepared to come up with that, that was very surprising. And it was so surprising, I felt well if they are prepared to do that, I should perhaps let them have my medals to go with it. Now I'm going to need to re-think that, seeing as there's no singlet anymore. So I have no idea what Te Papa's plans might be from here on out."
Snell still has his medals, apart from one of his Tokyo ones which is "down in the Hall of Fame museum in Dunedin".
He is not giving up the search to find the original singlet. "I'm going to really turn our place inside out and see if I can find the singlet somewhere. But I kind of doubt that I'm going to."
Chances are slim whether or not he could still have it, he said.
"I have a habit of stuffing things in boxes myself. But I would have had that out on display if I had it. My wife organised a cabinet for some of my memorabilia, so it would have been in that for sure.
"It's around somewhere. But it is going to be interesting to find out what it is they felt meant that it wasn't the genuine article."
The fake had everyone else fooled, Snell included.
"I think they originally had someone look at it who ruled it being authentic. From a casual look everything else looked all right, from the label that was sewn on there. It must have been something to do with maybe the fabric wasn't right - who knows. I guess we'll find out."
