The Senate vote that drove a stake through the delicate compromise was a stinging setback for Mr. Bush, who has made reshaping immigration laws a central element of his domestic agenda.
Republicans backing the bill tried to bring their colleagues on board by arguing that the president badly needed a domestic victory, reports CBS News correspondent Sharyl Attkisson. But in the end, senators in his own party turned their back on the president.
The defeat could carry heavy political consequences for Republicans and Democrats, many of whom were eager to show they could act on a complex issue of great interest to the public.
"Legal immigration is one of the top concerns of the American people, and Congress' failure to act on it is a disappointment," a grim-faced president said after an appearance in Newport, R.I. "A lot of us worked hard to see if we couldn't find common ground. It didn't work."
Sen. Edward M. Kennedy, D-Mass., his party's lead negotiator, called the defeat "enormously disappointing for Congress and for the country." But, he added: "We will be back. This issue is not going away."
Still, lawmakers in both parties said further action was unlikely this year, dooming its prospects as the political strains of a crowded presidential contest get louder.
"I don't see where the political will is there for this issue to be dealt with," said Martinez, who helped develop the bill.
House Democratic leaders signaled they had little appetite for taking up an issue that bitterly divides both parties and has tied up the Senate for weeks.
Rep. Zoe Lofgren, who heads the House Judiciary subcommittee that was to write a version of the bill, said the Senate's inability to move forward "effectively ends comprehensive immigration reform efforts" for the next year and a half.
"The Senate voted for the status quo," the California Democrat said in a statement.
The vote already had led to partisan finger-pointing.
Howard Dean, the Democratic Party chairman, said it was "a reminder of why the American people voted Republicans out in 2006 and why they'll vote against them in 2008."
The measure was the product of a liberal-to-conservative alliance led by Kennedy and Sen. Jon Kyl, R-Ariz., that forged an immigration compromise intended to withstand challenges from the left and right.
They advocated the resulting measure as an imperfect but necessary fix to the current system, in which millions of illegal immigrants use forged documents or lapsed visas to live and work in the U.S.
The proposal would have made those millions eligible for lawful status while tightening border security and creating an employee verification system to weed out illegal workers from U.S. jobs.
The bill also would have set up a temporary worker program and a system to base future legal immigration more heavily on employment criteria, rather than family ties.
Ultimately, though, what came to be known as their "grand bargain" commanded only lukewarm support among important constituencies in both parties. That was no match for the vehement and vocal opposition of Republican conservatives, who derided it as amnesty.
"The end result was a blanket that was too small to cover everyone," said Tamar Jacoby, an analyst at the conservative Manhattan Institute who was a strong supporter. "By its nature, because it was a compromise, it was hard to muster intense support. But the opposition was very intense."
Conservative foes' were among the loudest voices during the debate, led by Sens. Jeff Sessions, R-Ala., Jim DeMint, R-S.C., and David Vitter, R-La. Their views were amplified by talk radio and television hosts who attacked the bill and urged listeners to flood Congress with calls, faxes and e-mails.
The conservatives hailed the demise of the bill as a fitting death of an effort that had thwarted the public's will. They faulted Bush and their own party for trying to push through a measure that lacked public support and placed Republicans in a politically tough spot.
"They made a big mistake. I think the president's approach didn't work," Sessions said. Republicans "need to be careful we don't walk into such an adverse circumstance again. This did not work out well. Our own members were placed in difficult positions."
Bush made an unusually personal appeal for passage of the legislation, appearing at a luncheon with Senate Republicans this month to urge them to put aside their skepticism.
He sent Homeland Security Secretary Michael Chertoff and Commerce Secretary Carlos Gutierrez, as well as his top policy aides, to spend hours in Capitol Hill meetings with senators over a period of months to develop and then help push through the deal.
The two secretaries were on hand to buttonhole senators as they entered the chamber for votes.
The outcome, though, was a stunning reversal from just a few weeks ago, when Bush confidently declared, "I'll see you at the bill-signing."
Mexico's president, Felipe Calderon, said the Senate had made a "grave error" in killing the legislation. The action, he said, would cut off legal immigration, permit continued unlawful immigration and human rights violations and decrease security on both sides of the border.
The bill's Senate supporters fell 14 votes short of the 60 needed to limit debate and clear the way for final passage of the legislation. The vote was 46 to 53 in favor of limiting the debate.
Voting to allow the bill to proceed by ending debate were 33 Democrats, 12 Republicans and independent Joe Lieberman, Conn. Voting to block the bill by not limiting debate were 37 Republicans, 15 Democrats and independent Bernard Sanders of Vermont. Sen. Tim Johnson, D-S.D., who has been absent from the Senate all year due to an illness, did not vote.
In a mark of lawmakers' ambivalence on the issue, the outcome was substantially different from a test-vote earlier in the week, when the Senate voted 64-35 to revive the bill. Then, 24 Republicans joined 39 Democrats and Lieberman to move ahead with the bill. On Thursday, 12 of those Republicans and six of the Democrats switched their votes and opposed moving forward.
All the Democratic presidential candidates in the Senate voted to end debate and advance the bill. Among the Republican candidates, only Sen. John McCain of Arizona voted to keep the measure alive.