The competition had included Dundee, Swansea and Leicester which were all in the running for the accolade, but they were beaten to the coveted title by Hull.
The announcement yesterday was met with disappointment in Swansea where campaigners had worked hard on their “Cwtch The Bid” package, which was backed by the likes of Premier League boss Michael Laudrup and Hollywood star Michael Sheen.
But Secretary of State for Wales David Jones insisted those in the region should keep their heads held high, and harness their collective efforts again next year when the city plays host to a tourism-boosting centenary celebration.
He said: “As much as today’s announcement will come as disappointing news to those who have supported Swansea Bay’s bid, they should be rightly proud of all that they have achieved.
“The ‘Cwtch the Bid’ campaign was an inspiring effort that spread beyond a city and a region.
“It was an effort that galvanised the support and imaginations of people all across the country.
“We must now capitalise on the passion and commitment that this campaign has roused. With a whole year of celebrations planned in 2014 to mark the centenary of the birth of Swansea’s most famous son, Dylan Thomas, the region will still have its time to shine as a cultural powerhouse in Wales.”
Dundee will continue to host a large part of its events programme despite missing out on the title.
The Scottish city’s bid included plans to host the Turner Prize, the Man Booker Prize, large music events and a massive comic convention. Outdoor shows around the city’s landmarks, including the Tay Rail Bridge, were also planned and Hollywood actors Brian Cox, Alan Cumming and Tilda Swinton were among those it was hoped would feature in productions.
While the larger events will not go ahead, organisers said they want to build the cultural profile of the city.
The redevelopment of its waterfront will continue, with the £45m V&A Museum at the centre of the plans.
Bid director Stewart Murdoch said he was happy for Hull but the decision had left many people “brokenhearted”.
Leicester’s bid was entitled Illuminating Culture and focused on the city’s creativity and the diversity of its people. City Mayor Peter Soulsby confirmed that the best ideas in the bid will still take place as part of an 18-month programme of events starting next summer.
He said: “So much hard work and energy has gone into this process, and we must now continue with the momentum and fantastic ideas this has generated.”