Michael Phelps claimed his third gold medal of the Games, and fifth in all, as the United States pipped Australia in the 4x200m freestyle relay final.
Phelps swam the first leg before Ryan Lochte, Peter Vanderkaay and Klete Keller held on for victory.
But Keller finished only 14 hundredths of a second ahead after a marvellous last leg by Ian Thorpe for Australia.
The Great Britain quartet set a new national record in finishing fourth behind Italy, who claimed the bronze.
IAN THORPE MEDAL COUNT
400m freestyle: Gold
4x100m free relay: Australia finished sixth
200m freestyle: Gold medal (VdH 1st, Phelps 2nd)
4x200m free relay: Silver (behind US team incl Phelps)
100m freestyle: Ranked 4th, VdH favourite
4x100m medley relay: US have never lost at Olympics
It was Phelps' second gold medal of the evening, having earlier won the 200m butterfly, and the young American was ecstatic, jumping up and down on the poolside.
"Australia had owned that event," said Phelps, who having swum the first leg, could only watch as Thorpe clawed back a full 1.5 seconds on Keller in a nailbiting finish.
"As a goal, I wanted to come in here and prove something.
"This was probably the most exciting race I've ever been a part of - it was such a big team effort. It will go down as one of the greatest races in history," he said.
The Americans came home in 7:07.33, with the Australian quartet of Grant Hackett, Michael Klim,
Nicholas Sprenger and Thorpe second in 7:07.46.
"I'm not making excuses, but I feel a bit flat," said the Australian, who had been masterful on Monday night in beating Van den Hoogenband and Phelps in the intense individual race.
"I'm pretty disappointed - I was trying not to rush it, to catch up. I didn't want to throw myself at the first hundred metres."
MICHAEL PHELPS MEDAL COUNT
400m individual medley: Gold (world record 4:08.26)
4x100m free relay: Bronze behind SA and Netherlands
200m freestyle: Bronze (Thorpe 1st VdH 2nd)
4x200m free relay: Gold (Australia not lost since '97)
4x200m butterfly: Gold
200m individual medley: reigning world champion
4x100m medley relay: US never lost at Olympics
100m butterfly: Lost to world champ Ian Crocker last year
Emiliano Brembilla, Massimilliano Rosolino, Simone Cercato and Filippo Magnini were third for Italy in 7:11:83.
Simon Burnett gave Britain the ideal start, finishing his leg in third place behind Phelps and Hackett.
Gavin Meadows and David O'Brien swam the second and third legs before Ross Davenport anchored them home in 7:12.60, a new British record.
"We won fourth tonight, we didn't lose third," Davenport said. "No-one expected us to reach the final and we have done the best we can. I am proud to be here."