Murray was comprehensively beaten by the Serb, 6-4 6-2 6-3 in two hours and 39 minutes, as he stumbled at the final hurdle for the third time and Britain's 75-year wait for a men's grand slam singles champion carried on.
Although the British number one admitted he performed below expectations, he also felt he came up against an opponent in prime form.
"He played great although I would have liked to have played better," said Murray.
"I think he would have beaten every other player on the tour tonight.
"He served well, he didn't make many mistakes from the back of the court, he moved really well and he hit the ball cleanly."
Murray did break one record - albeit not one he will look on fondly - after becoming the first man in the open era not to win a set in three grand slam final appearances.
The first two defeats, at the US Open in 2008 and here 12 months ago, saw him lose to an overwhelming favourite in Roger Federer but he came into this contest seemingly on a par with Djokovic.
But what transpired will haunt Murray for some time.
His first serve percentage was a lowly 53%, his groundstrokes continually missed their target, his body language was negative while his movement, so often his strength, proved another weakness.
His sluggish display prompted talk of an injury but Murray confirmed he was 100% fit.
"I thought I moved decent," he insisted.
"I could have moved better but no, I wasn't injured.
"Against Novak you need to be firing on all cylinders and I didn't move as well as I would have liked."
Murray at least competed in the opening exchanges with the first set remaining on serve until 5-4 when Djokovic broke to claim an early advantage.
But from there on in, it was one-way traffic.
Djokovic quickly established a 5-0 lead in the second set and although Murray broke for the first time to avoid total humiliation, he could not prevent himself from falling two-sets down.
Another Murray break at the start of the third offered brief hope of a turnaround but Djokovic promptly broke back twice to move 3-1 ahead.
The 23-year-old from Dunblane hit back once more but Djokovic again had the answer by re-establishing his advantage for a 5-3 lead and he coolly served it out.
Murray revealed after his semi-final win over David Ferrer that he had to resort to a plan B to get past the Spaniard.
But even plan B did not work for the world number five tonight.
"I started to go for my shots more as the match went on," he said.
"At the start both of us were trying to feel each other out a little bit and as you work your way into the match you start to find patterns and go for your shots more.
"I started taking more chances and managed to break serves a few times but I wasn't able to keep it up for long enough."
Even though it appeared another chastening experience, Murray was adamant he felt better than 12 months ago when he was reduced to tears by Federer.
"It's better than it was last year," he said.
"It is obviously tough and disappointing but I have got to deal with it."
Djokovic felt his performance was as good as it got.
"It was a great match. From the start to the last point I did what I intended to do tactically and what I prepared for," said Djokovic, who claimed his second grand slam crown after also winning in Melbourne in 2008.
"I was aware of the fact I was going to have some long rallies against a player who doesn't miss a lot, a very talented player who is one of the best returners in the game.
"So I had to step in, that was the key.
"When I had the chance to step in and move him around the court that's what I did.
"The turning point was probably the last game of the first set when we had some incredible rallies from the baseline.
"When you have a set advantage, it's much different."