The Impact raised the hopes of the 61,004 fans jammed into Olympic Stadium with a first half goal from Andres Romero only to see their defence carved for four goals after the intermission by a more skillful and cohesive Club America on Wednesday night.
Mexico City's top team won 4-2 to take the two-game aggregate goals final 5-3 and earn the spot in the prestigious Club World Cup in December that the Impact desperately wished for.
"I thought we were the better team in the first half, but when you give a team like that good looks at goal, they're going to punish you," Impact midfielder Dilly Duka said. "They were all over us in the second half."
Club America, disappointed in a 1-1 draw at home in the first leg last week, got its first title in the Champions League era (since 2009), although it had won the previous version of the competition five times.
Dario Benedetto had a hat trick and Oribe Peralta also scored for the Mexicans, while substitute Jack McInerney's reply in the 89th minute was too little, too late for Montreal.
"We talked in the locker-room (at half time)," Club America coach Gustavo Matosas said through an interpreter. "We knew we had possession of the ball, we were playing well and we just had to have patience.
"The quality of my players showed today. They scored the goals we needed. I also congratulate Montreal. They have a great team and they had a good performance."
The Impact finished last in Major League Soccer last season, but saved some face by winning the Amway Canadian Championship to qualify for the Champions League.
Their run to the final included a stunning quarter-final win over Pachuca of Mexico on rookie Cameron Porter's last-second goal and another upset of Costa Rica's Alajuelense on the away-goals rule.
That made them the first Canadian team, and only the second MLS club, to qualify for the final. And their first leg draw in Mexico had the team and the fans who stormed back onto the bandwagon giddy with anticipation.
The Big O was aroar with the team's "Allez Montreal" fight song as Ignacio Piatti dribbled through two defenders and set up Romero for the opening goal eight minutes in.
And luck looked to be on their side eight minutes later when America's star forward Benedetto had an open net and somehow hit a post from close range.
Who knows how America's spirits would have sagged if Piatti had finished a chance in alone on 'keeper Moises Munoz in the 24th? It turned out to be Montreal's last shot at unexpected glory.
"It's pretty low in there," Duka said with a gesture to the Impact locker-room. "But thinking about it, we should be proud of what we've done.
"Our team was put together two months ago and we came together and had a good run. Club America's history, talent, payroll, speak for themselves. You give them a chance and they're going to punish you."
Benedetto volleyed in the tying goal five minutes into the second half. Then Oribe nodded one home in the 64th, Benedetto charged in for a goal in the 66th and completed the hat trick when left wide open from near the penalty spot in the 81st.
The compact, defensively sound Impact from the first half had been pulled wide open in the second.
"We got stretched out," said coach Frank Klopas.
The Impact hope the experience will help them in MLS play, where they are 0-2-2 and back in last place. They had two games postponed until the fall to let them prepare for Champions League matches. A tough schedule awaits.
"Right now everyone's pretty disappointed, but in a week or two we'll look back and we should be proud of ourselves," said McInerney. "If we can carry this into MLS, I'm sure we'll make the playoffs."
Notes _ With both Victor Cabrera and Hassoun Camara injured, Nigel Reo-Coker was moved to right back and Marco Donadel went in at holding midfielder. . . Recent acquisition Kristian Nicht, playing for suspended goalie Evan Bush, played OK and wasn't a factor in the result. . . The record crowd for soccer at the Big O is 71,617 for East Germany's 3-1 win over Poland at the 1976 Olympics.