Juan Carlos I abdicated as the kind of Spain yesterday afternoon.

A few hours later and 23 of his compatriots gave up their throne as World Cup holders as the Spanish national team became the first reigning champions in history to be knocked out of the competition after just two group matches. Their hopes were trampled by Chile last night.

The idea of this Spanish team - replete with players such as Iker Casillas, Xabi Alonso, Andres Iniesta and David Silva - being humbled so publicly might have seemed fanciful just a few weeks ago. It was a dream realised by Chile's coach Jorge Sampaoli last night as the Argentine laid the foundations for a victory in which and Eduardo Vargas and Charles Aranguiz both scored.

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It is not the first time that the holders have failed to make the knock-out rounds - Italy suffered that indignity in 2010, as did France eight years earlier - but never before has it happened after the first two games. An opening 5-1 defeat by the Netherlands hurt the Spaniards, but this one really smarts.

Chile were bristling with intent, as were around 200 of their fans as they broke through a security cordon to try and gain entry to the match having failed to get tickets. Their actions were later admonished by FIFA officials.

The conduct of the Chile players would be roundly applauded, though - Gonzalo Jara sending a header over within the opening minutes of the Group B match.

Vargas found the target after just 19 minutes. It was a goal which stunned their opponents but was wonderful to watch, Alexis Sanchez first snapping up possession and then playing in Aranguiz, who picked out Vargas with a delightful pass. The Valencia forward neatly sidestepped Casillas before nudging the ball into the net.

Spain's aspirations were fractured further two minutes before the break when Casillas parried a tame free-kick into the path of Aranguiz, who controlled the ball and poked it into the net.