Cameron Norrie’s hopes of winning his first ATP Tour title were ended as he lost 6-4 6-7 (5-7) 6-3 to Italian top seed Matteo Berrettini at Queen’s Club.
The British number two fought back after losing the first set to become the first player to take a set off Berrettini at the Cinch Championships.
But world number nine Berrettini, who fired down 19 aces, secured the crucial break in the third set to seal victory.
He is the first player to win the title on debut since Boris Becker in 1985.
Norrie, 25, was bidding to become only the second Briton after Andy Murray to win the Queen’s title in the Open era.
The left-hander had never won a match at Queen’s before this year but has made a big breakthrough by reaching his first grass-court final – and he still has a double semi-final to play later.
Norrie has had the best season of his career, winning 29 matches and reaching three finals, and will move up to 34 in the world rankings, which, because of the absence of Rafael Nadal and Milos Raonic, should be enough to earn him a seeding at Wimbledon.
Berrettini, who beat Murray and Dan Evans to reach the final, becomes the first Italian to win the Queen’s title – the fifth of his career – and he will seek to emulate Becker by going on to lift the Wimbledon title.
Meanwhile, Britain’s Gordon Reid won the wheelchair final with a 6-2 6-2 victory over Argentina’s Gustavo Fernandez.
Elsewhere, Ugo Humbert of France beat Russia’s Andrey Rublev 6-3 7-6 (7-4) to win the Halle title.