A secret bid by Football Federation Australia would have seen the key mainland capitals host showpiece Copa America clashes including Brazil, Argentina and the Socceroos.
The FFA were invited by global sports giants IMG to put together a proposal to CONMEBOL to move the Copa America to Australia in a special one-off tournament.
The tournament – South America's version of the Euros or Asian Cup – is switching from odd number years to even number years with back to back Copas in 2019 and 2020.
Organisers initially thought the tight turnaround might not give South American nations enough time to put it on and turned to IMG to come up with alternative venues, who then approached the FFA to gauge interest.
The FFA rapidly put together a secret bid with state governments to play the star-studded matches in Sydney, Melbourne, Brisbane, Adelaide, Perth and Canberra.
As hosts, the Socceroos would have had a guest spot in the tournament to take on the likes of Lionel Messi, Sergio Aguero and Luis Suarez, along with another invited international guest nation.
But the bid fell narrowly short at the final hurdle despite CONMEBOL reportedly being impressed and tempted by the Australian offer.
A close vote saw CONMEBOL vote to keep it played in South America despite the lack of time to organise.
An FFA spokesman added: "Feedback was very positive about the Australian proposal. Ultimately CONMEBOL decided to keep the event in South America which FFA totally respects."