The historic Maracana stadium was witness to the death of tiki-taka football, the short passing game made famous by the Spaniards, as Chile displayed brute force to blank the pre-tournament favourites.
The defending champions looked jaded and were constantly outpaced by their seemingly more determined rivals.
Spain needed either a win or at least a draw to remain afloat but ended up joining Brazil (1966), France (2002) and Italy (1950 and 2010) in the dubious club of defending champions bowing out of World Cup in the first round.
Eduardo Vargas put Chile in the lead in the 20th minute before Charles Aranguiz made it 2-0 in the 43rd minute to send Spain packing in front of a packed crowd. Chile thus avenged their 1-2 loss to the same opponents in their group match in the 2010 World Cup.
By virtue of the win, Chile made it to the round of 16 from Group B along with the Netherlands. Spain's final group match against Australia on June 23 at Curitiba has now been rendered inconsequential.
Meanwhile, Brazil 2014's scintillating show of attacking football continued with Croatia thrashing a 10-man Cameroon 4-0 in Group A.
Goals from Ivic Olic, Ivan Perisic and a Mario Mandzukic brace helped the Croatians coast to victory while Cameroon had Alex Song sent off in the first half for a wild punch.
In other matches of the day, the Netherlands rallied from a goal down to edge past a gritty Australia 3-2 in a Group B match at Porto Alegre while Croatia sent Cameroon packing from the tournament with a 4-0 thrashing in Group A at Manaus which saw Alex Song being red-carded for elbowing an opponent in a moment of madness.
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