Glasgow-based Gilmour, the second seed, was unable to impose herself on the third seed at the Emirates Arena and had to settle for silver as she went down 21-14 21-6.
The match, between the players ranked 17th and 19th in the world, was expected to be evenly contested but it proved anything but as Gilmour was outplayed.
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The 20-year-old Scot slumped to the ground after losing the final point - handing Canada a first gold in women's singles - after 38 minutes.
Afterwards Gilmour admitted her emotionally-draining semi-final win over Jing Yi Tee, which she finished in style by reeling off 10 successive points, had taken its toll.
Gilmour said: "I'm trying to be disappointed but everyone's being so positive.
"It's not that I don't care, but I've got a silver medal round my neck and I'm delighted.
"Obviously I wanted to go one better but Michelle was on fire and I had no answer.
"I gave so much concentration-wise yesterday for those last 10 points - probably the most I have ever concentrated in my whole life - to have to knuckle down and reproduce it was a bit of an ask.
"I gave my best but maybe I was just not 100 per cent there."
Despite Gilmour's defeat, Scotland can still reflect on their most successful badminton showing at a Commonwealth Games, in terms of medals, since 1986.
Imogen Bankier and Robert Blair were the other pair to register on the medal table after taking bronze in the mixed doubles.
In terms of legacy there will also be high hopes for the future after 11 days of competitive action in the city in front of enthusiastic crowds.
Gilmour now returns to normality and an essay she has to write as part of her screenwriting and film course at the West of Scotland University.
She said: "It's a film pitch - I don't actually have to make the film - and it's on the effects of the referendum on Scottish sport.
"It's due in on the 14th, and then I think we leave for the World Championships on the 21st.
"So, no rest for the wicked. I'll just try to enjoy this for the next few days."