Phelps didn't even make it to the podium in the 400-meter individual medley at the Aquatics Centre on Saturday, the first full day of competition at the games. He was fourth behind winner and fellow American Ryan Lochte, who was ahead of the world record but faded on the last lap.
Lochte was more than three seconds ahead of Brazil's Thiago Pereira. Japan's Kosuke Hagino claimed the bronze.
It was a wild night at the pool, with Ye Shiwen setting a world record to win the women's 400 IM, China's second gold of the night. Sun Yang won the 400 freestyle, beating 2008 champion Park Tae-hwan of South Korea, who was reinstated for the final after first being disqualified in the heats.
Park touched the wall first in his heat, but was thrown out for a false start. South Korea filed a protest which was upheld by governing body FINA, and Park later led the final before finishing up with silver.
The 16-year-old Ye trailed American teenager Elizabeth Beisel but pulled away in the freestyle leg to win gold in 4 minutes, 28.43 seconds. She beat the mark of 4:29.45 set by Stephanie Rice at the 2008 Beijing Olympics.
Beisel settled for silver in 4:31.27, while Li Xuanxu gave China another medal by taking the bronze in 4:32.91. Rice was sixth.
China won four of the 12 gold medals on offer and Italy collected two on the opening day, when Queen Elizabeth II was among the thousands of spectators who flocked to the Olympic Park on a sunny day in London. The British monarch was of the stars of the glittering opening ceremony the previous night. Tens of thousands more people lined the route of the cycling road race, the rowing course outside London and at venerable Wimbledon, site of the tennis competition.
Britain's hot prospect for gold on the opening day didn't even win a medal, with Mark Cavendish disappointing hometown fans when he finished well back in the pack behind gold medal winner Alexander Vinokourov of Kazakhstan in the road race.
"It's just unbelievable," said doping-tainted Vinokourov, who won Olympic silver in the road race at Sydney in 2000. "I finished the Tour de France a little tired, but the Olympics, I must go there."
There was also a first doping sanction for the London Games: the International Olympic Committee banned Albanian weightlifter Hysen Pulaku after he tested positive for a banned steroid, stanozolol, on July 23.
Vinokourov himself was tainted by doping. Third at the 2003 Tour de France, Vinokourov served a two-year doping suspension after twice testing positive for banned blood transfusions during the 2007 race.
The Kazakhstan cyclist, who said earlier this year that he would end his career after the London Games, broke away from the leading group about 10 kilometres from the finish with Rigoberto Uran of Colombia.
Vinokourov then accelerated with 300 metres to go to leave Uran in his wake. Uran took silver, with Alexander Kristoff of Norway claiming bronze.
Vinokourov's triumph ended Cavendish's hopes of adding the Olympic title to the gold medal he won at the world championships last year. The British team tried to control the race from the start but could not prevent the final breakaway to succeed.
"What we needed was a couple of guys to help us," British road captain David Millar said. "The Germans came up but we needed some help."
Cavendish was officially given 28th place, 40 seconds behind Vinokourov.
Chinese shooter Yi Siling had the distinction of being presented the first gold medal of the 30th Summer Games with a victory in the women's 10-meter air rifle.
The Italian fencers swept the medals in the women's individual foil, with Elisa Di Francisca beating Arianna Errigo for gold, and Italy's men won the archery team gold medal at Lord's, beating the United States and South Korea.
The Australian women's 4x100-meter freestyle relay team collected the last gold medal of the opening day by edging Netherlands and the United States at the Aquatic Centre.
Other gold medallists included Jin Jong-oh of South Korea in the men's 10-meter air pistol and four-time world champion Wang Mingjuang of China in the women's 48-kilogram weightlifting class.
In judo, Sarah Menezes of Brazil took the women's 48-kilogram event and Arsen Galstyan of Russia the men's 60-kilogram.
Wimbledon champions Roger Federer and Serena Williams won their opening tennis matches in contrasting fashions.
Federer, a four-time Olympian, overcame a jittery patch and beat Alejandro Falla of Colombia 6-3, 5-7, 6-3. The top-ranked Swiss star was a point from victory in the second set, then lost three of his next four service games. But he recovered in time to avoid the upset.
U.S. First Lady Michelle Obama watched from the front row of Williams' player box as the fourth-seeded American beat former No. 1-ranked Jelena Jankovic of Serbia 6-3, 6-1 on Centre Court.
Williams is aiming for her first gold medal in Olympic singles; she has won two gold medals in doubles with her elder sister, Venus.