Juventus blew a 3-1 advantage from the first leg and David Trezeguet's early goal in the second to lose 4-1, ending the match with nine men after Fabio Cannavaro and Jonathan Zebina were sent off in a 5-4 aggregate defeat.
It was the latest in a series of capitulations a squad featuring a big contingent of the players Marcello Lippi is expected to take to South Africa has suffered this season.
The Turin side also crashed out of the Champions League with a 4-1 defeat in December to Bayern Munich and their struggles in Serie A have not stopped since the club replaced coach Ciro Ferrara with Alberto Zaccheroni in January.
Indeed, they are outside the Champions League qualification zone in fifth after surrendering a three-goal lead in last weekend's 3-3 draw at home against bottom side Siena.
Italy's 36-year-old captain Cannavaro had to take a share of the blame for Thursday's defeat, losing the duel with Fulham's Bobby Zamora before getting himself sent off in the middle of the first half for a last-man foul.
Some commentators see his problems as exemplifying those of the old guard Lippi continues to rely on despite a World Cup qualification campaign in which they rarely shone.
"It's a national question because Cannavaro's flop seems to be a metaphor of what could happen in South Africa to the glorious old fashioned group who remain bonded to Lippi," read an editorial in Friday's La Gazzetta dello Sport.
The problem is not viewed as being limited to Cannavaro's Juve team mates Mauro Camoranesi, Gianluigi Buffon, Fabio Grosso and Vincenzo Iaquinta, who were also part of the 2006 World Cup-winning outfit.
"We are talking about (AC Milan midfielder Gennaro) Gattuso, Grosso, Buffon, (Milan full back Gianluca) Zambrotta, Iaquinta and Camoranesi, as well as (AS Roma strikers Luca) Toni and (Francesco) Totti if they return," the editorial said.
Thursday's defeat increases the possibility of Italy losing their fourth Champions League qualifying spot to Germany from 2011.
Inter Milan, who do not have any Azzurri regulars, are now Italy's sole representative in European competition after they reached the Champions League quarter-finals.
It also raises pressure on the under-fire management that took over Juventus after the 2006 match-fixing scandal which led to the team spending a year in Serie B.
Captain Alessandro Del Piero, who has been at Juve since 1993, has no doubts about how serious the situation is.
"It's certainly the most difficult year since I've been at Juventus," he told reporters.
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