The United States crashed out of the Copa America on Monday after a 1-0 defeat to Uruguay, as Panama sealed their place in the quarter-finals with a 3-1 win over Bolivia.

Team USA, who suffered an upset 2-1 defeat to Panama last Thursday, went into Monday's final Group C game at Arrowhead Stadium in Kansas City needing to match or better Panama's result against Bolivia to advance.

But US coach Gregg Berhalter's side never looked like doing enough to seriously threaten a well-drilled Uruguay outfit who advance to the last eight as group winners.

"It's difficult to say right now, obviously the emotions are running high," disappointed US captain Christian Pulisic said.

"We had a good start and brought a lot of energy, but just didn't have enough quality. We just couldn't find a solution."

Hopes of a great escape for the tournament hosts faded inside the first 30 minutes, as news filtered through that Panama had taken a 1-0 lead against Bolivia in Orlando.

Those hopes were revived early in the second half after Bolivia equalised to make it 1-1, leaving the US on course for qualification provided they continued to hold Uruguay.

Yet the US optimism was punctured just moments later when Uruguay took the lead in controversial circumstances through Mathias Olivera on 66 minutes.

Ronald Araujo's powerful header from Nicolas de la Cruz's free-kick was parried away by US goalkeeper Matt Turner, but only into the path of Olivera, who tucked away the rebound.

Replays appeared to show that Olivera was offside when Araujo first made contact with the ball, but despite a lengthy VAR review, Peruvian referee Kevin Ortega ruled that the goal should stand.

The mathematics of qualification looked even more bleak for the US after news that Panama had scored again through Eduardo Guerrero to regain the lead at 2-1, and the final nail in the coffin came when Cesar Yanis added a third for Panama in stoppage time.

The USA's first-round exit raises fresh questions about the future of US coach Berhalter, who remains deeply unpopular amongst swathes of American fans.

Berhalter was only reappointed to the US job in June last year following a hiatus after leading the team to the 2022 World Cup.

Yet the nature of Monday's early exit is certain to reignite debate about whether he is the best man to lead the United States into the 2026 World Cup on home soil.

Failure to defeat Uruguay, 14th in the latest FIFA rankings, extends Berhalter's poor record against top 20 teams.

Berhalter has just five wins in 20 matches against top-20 teams during his reign, and four of those victories came against regional rivals Mexico -- who were also been eliminated from the Copa in the first round.

That dismal sequence continued after a toothless attacking performance from Berhalter's side against Uruguay, where they registered only three shots on goal in a misfiring offensive display.

US defender Antonee Robinson described the officiating as "amateur hour" but stressed responsibility for the defeat lay with the American players. "Just not enough quality in the final third," Robinson said.

"At the end of the day we weren't good enough to get the result today. This is on us."