After the high of last year, when he ended Fred Perry's 77-year reign as the last British man to win the singles title, this was a sad way for the third seed to bow out.
Murray never managed to find anything like his best form while Dimitrov played an inspired match to win 6-1 7-6 (7/4) 6-2 and reach his first grand slam semi-final.
The defeat ended Murray's 17-match winning streak at the All England Club and was his first slam loss to a player ranked outside the top 10 in four years.
Murray had lost his first set of the tournament as Dimitrov stormed into an early lead in their Wimbledon quarter-final.
The defending champion simply could not get going against an opponent playing high-class tennis and the 6-1 scoreline made it the most one-sided set Murray has lost at the All England Club since his debut in 2005.
Murray had reached the last eight without dropping a set for the second straight year but his form had been even better than 12 months ago.
This was the match-up that created excitement when the draw was made - defending champion against tennis' pin-up boy.
Touted as Baby Federer and one half of the sport's glamour couple with Maria Sharapova, Dimitrov has been making headlines on the court over the past year.
Tough Australian coach Roger Rasheed has helped the 23-year-old develop the physical side of his game to go with his exceptional racquet skills.
He made a tentative start to his first Wimbledon quarter-final but Murray was unable to take advantage of a break point and he was made to pay for that in the fourth game.
Dimitrov played a terrific return game and broke the Murray serve when he forced the Scot to guide an attempted backhand pass wide.
The Scot was making more errors than he had in his previous four matches while Dimitrov was not missing a beat.
Three more break points arrived for the Bulgarian in the sixth game and he only needed one, Murray putting a forehand into the net.
That left Dimitrov serving for the set and, although Murray saved one set point, the Bulgarian put away a simple smash on the second.
This was not an unfamiliar position for Murray, who at the same stage last year trailed Fernando Verdasco by two sets before fighting back to win.
Nerves seemed to be coursing through the champion's body, and the crowd feared the worst when he served two awful double faults in the third game of the second set, but he did enough to come through it.
Perhaps the scoreline was not too surprising given their respective seasons - Dimitrov having won three titles, including his triumph at Queen's two weeks ago, while Murray has not made a final since having back surgery last September.
Dimitrov looked so much more confident and he broke for the first time in the set for 4-3.
Murray played his best point of the match to save the first break point but on the second he served a 93mph first serve and then erred with a horrible backhand slice.
He looked towards his support camp with arms held wide as if looking for answers, and he found them in the next game, with some help from his opponent.
Having been rock solid, Dimitrov's backhand let him down, allowing Murray to level straight away at 4-4.
Centre Court held its collective breath at 30-30 in the next game as the pair pulled each other all over the court in a 31-stroke rally.
Murray won it, and then served an ace to hold, but the pressure was relentless and he needed two big serves to save break points at 5-5.
A tie-break would settle it, and it was Dimitrov who made the first meaningful move with a backhand pass to lead 5-4.
A delightful drop volley gave the Bulgarian two set points, and he took the first for 7-4 as a desperate attempt at a pass from Murray found the net.
Murray had come back from two sets behind to win matches seven times before but against a player playing at Dimitrov's level it was a seriously tall order to do it again.
The 23-year-old's defence had been exceptional, more evidence of the improvements made under Rasheed, who Murray came close to hiring in 2011 before opting for Ivan Lendl.
Things went from bad to worse for Murray when, from 40-15, he lost four points in a row to drop serve at 3-2 behind, ending on a double fault.
He looked a beaten man, and another double fault gave Dimitrov a first match point after exactly two hours.
Murray saved that with one of his best forehands of the match but then netted a forehand to hand Dimitrov an unexpected but thoroughly deserved victory.
Murray sat disconsolately in his chair before trudging off alongside Dimitrov, pausing to bow to the Duke and Duchess of Cambridge in the Royal Box and wave to the crowd, who cheered their fallen hero.