Arrogate's seven-race winning streak snapped by Accelerate who also beat him last year at Los Alamitos.
Dubai World Cup winner Arrogate 'just wasn't trying' in big defeat to Accelerate at Del Mar
Mike Smith tried everything he could with Arrogate. He moved the colt to the outside, but he did not pick up the pace. Smith dropped him down near the rail before wheeling him outside once more.
"He just wasn't trying," the Hall of Fame jockey said.
Accelerate stunned overwhelming favourite Arrogate to win the US$300,000 (Dh1.1 million) San Diego Handicap by eight-and-a-half lengths on Saturday at Del Mar, snapping the seven-race winning streak of the world's top-ranked horse.
Arrogate finished fourth, beaten by 15 one-fourth lengths in the four-year-old colt's first race since March 25 in Dubai.
"I'm at a loss for words," Smith said. "He was just flat, so flat."
His trainer, Bob Baffert, was blunter, saying Arrogate "laid an egg".
It was not the first time Accelerate got the best of Arrogate. Last year at Los Alamitos, Accelerate beat Arrogate by a neck in the colt's career debut in a race won by another horse. It was Arrogate's lone loss until Saturday.
"I thought he'd run better than that," Baffert said, "but he just didn't want to go."
Geoffrey Riddle: Arrogate unlikely to run again until August
Dubai World Cup in 2017: As it happened
Accelerate lived up to his name, leading all the way.
"He got in a nice rhythm. He was going easy," said Victor Espinoza, aboard for the first time. "I was surprised by how far I won. I wasn't surprised that I did; I was here to win."
Arrogate's winning streak included the $6m Breeders' Cup Classic last year, the $12m Pegasus World Cup and the $10m Dubai World Cup. He earned $18,000, boosting his career total to $17,102,600, a North American record.
It was not the first time Baffert had led a world-beater to the track only to watch him lose.
That is what happened in 2015, when American Pharoah was stunned by Keen Ice in the Travers barely two months after becoming horse racing's first Triple Crown winner in 37 years.
"That's why my hair is white," Baffert quipped after the race.
Under the race's handicap conditions, Arrogate carried high weight of 126 pounds, spotting Accelerate nine pounds. But Baffert said the weight difference had nothing to do with the result.
The race as it unfolded
Heading to the rail beforehand, Accelerate's trainer, John Sadler, said he thought the race would be closer than people thought.
"You want to win, you don't want to concede anything, but I'm surprised we won because Arrogate is the best horse in the world," Sadler said. "A couple of things went right for us and one of them was that Arrogate didn't fire his best. That's what has to happen for these big upsets."
With Accelerate setting the pace, Smith had Arrogate last through the opening kilometre or so before they began making their move into the far turn. But Arrogate's rally was brief while Accelerate cruised to the finish line in front of a shocked crowd at the seaside oval north of San Diego.
Arrogate will have a chance to turn the tables in the $1m Pacific Classic on August 19, when the two colts are expected to meet again.
"We've got to go back and start over again," Smith said. "Get it back right."