Spain have been knocked out of the World Cup tonight as Chile beat the title holders 2-0 at the Maracana to book their place in the last-16 stage with a game to spare.

The Netherlands' 3-2 win over Australia earlier today ensured that the 2010 winners needed to avoid defeat in order to keep alive their hopes of moving into the second round.

However, first-half goals from Eduardo Vargas and Charles Aranguiz proved enough for the South Americans to claim their place in the latter stages and consign La Roja to a short-lived defence of their world title in the process.

Vicente del Bosque's side endured a nervy start to the encounter and almost went behind twice in the opening two minutes, as Vargas saw his effort deflected narrowly wide before Gonzalo Jara went close from the resulting corner.

Xabi Alonso should have fired the Spaniards ahead on 17 minutes but shot straight at goalkeeper Claudio Bravo, while Diego Costa also went close.

Both chances would become moments of significance just minutes later as Vargas fired Chile ahead by producing a tidy first touch to control Aranquiz's low cross before poking past Iker Casillas.

It went from bad to worse for Spain shortly before the break, as Casillas fumbled Alexis Sanchez's free kick and Aranguiz was on hand to convert the rebound to give their European counterparts an uphill task.

It became clear that it was not going to be Spain's night early in the second half, as Sergio Busquets, with the goal at his mercy, put a David Silva cross wide of the mark.

Nevertheless, the defending champions continued to pour forward in their bid to reduce the arrears, and second-half substitute Santi Cazorla twice went close to halving the deficit, only to be denied by Bravo twice.

Chile's defence held strong in the final minutes to close out their victory and ensure that Del Bosque's men would not be back at the Maracana on July 13 to contest the final.