Sweden upset the US in the final group game for the 2-1 somewhat deserved victory.
Sweden scored a penalty and directly from a free kick in the first half, and those were enough to see them win their group for the first time.
Abby Wambach finally scored from a corner kick midway through the second half, but the US didn't play very well as a team throughout.
They were unfortunate not to score in the first half and were punished by two defensive lapses.
Amy LePeilbet gave up the penalty with a clumsy challenge and then her deflection sent Nilla Fischer's free kick away from Hope Solo.
It was the US's first ever loss in World Cup group stages.
Sweden will take on Australia, and the US will now take on Brazil in the quarterfinals.
The final group game of the 2011 FIFA Women's World Cup takes place this afternoon with Team USA taking on Sweden with first place in the group up for grabs.
Both teams are already in the quarterfinals, but the Group C runner-up will have the tough task of facing Brazil this weekend.
The winner will take on Group D runner-up Australia.
Both teams have six points from two games, but the US has the superior goal difference and only needs a draw to win the group.
Star forward Abby Wambach will start after not practicing for two days, but Megan Rapinoe will reclaim her starting spot in he place of Heather O'Reilly.
US coach Pia Sundhage says she could substitute Wambach after the first half.
Hope Solo has looked great in goal, but Sweden should be the first to really test her. Sweden has the bigger mountain to climb here, but the US's defense has been solid throughout.
Keep it here for updates throughout the game as the last quarterfinal places in the 2011 Women's World Cup are set.
Live Score: Sweden 2-1 USA Fulltime
Dahlkvist 16' (penalty); Abby Wambach 66'
Nilla Fischer 34'