The Blues failed to turn up during the opening 45 minutes at Old Trafford as United ran riot and could easily have found themselves more than 2-0 down.
They rallied somewhat in the second half but the final 2-1 scoreline flattered them as they all but surrendered the title they won last year.
Slow out of the traps: John Terry (grounded) and his team-mates went two goals down early on
The defeat left them six points behind United with two games remaining, undoing all their hard work over the previous two months to claw back a 15-point deficit.
Chelsea conceded after just 36 seconds yesterday and captain Terry struggled to explain why they were caught cold.
He told Chelsea TV: 'I'm not sure. We were fully prepared and it's one of those things. "Disappointing day but, going back two months, we would've taken this - being in the position (three points behind United at the start of the game).
'We felt it was in our hands and we could come here and we could win the game. Sometimes, you have to hold your hands up.'
Leading by example: Terry's opposite number, United captain Nemanja Vidic (right) was on target
He added: 'We came hoping and praying that we started well and the role was completely reversed.
'They had a great start and got the early goal, which settled them. But, first half, we didn't deserve anything from the game at all.
'I thought second half we came out, we had nothing to lose and went for it and dominated the second half.
'It just would've been interesting to get that second goal and get it back to level terms.'
Feeling the heat: Chelsea manager Carlo Ancelotti could be heading for the Stamford Bridge exit
The result appears certain to cost manager Carlo Ancelotti his job, with the Italian set to oversee Chelsea's worst season since Roman Abramovich bought the club eight years ago.
Ancelotti was expecting to learn his fate soon after the Blues' final game of the season at Everton.
Meanwhile, midfielder Michael Essien has ended his self-imposed one-year exile from the Ghana national team.
Essien controversially put his Black Stars career on hold after suffering two serious injuries. But he told BBC Sport: 'I am fully ready to return to the Black Stars for our next Africa Cup of Nations qualifier against Congo in June.
'I still have a lot to offer my country and it never crossed my mind to retire from the national team.'
All over: Terry and fellow Blues defender Ashley Cole leave the pitch at Old Trafford
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