It was a devastating blow to new director-general Greg Dyke, who had made saving football coverage a personal priority.

Defeat in the Premiership bidding battle means the end, after next season, of Match of the Day, a national institution dating back some 36 years. It has been the focus of millions of domestic arguments on Saturday nights, with husbands insisting on watching and children begging to be allowed to stay up.

Now ITV will be showing the weekend highlights programme from August 2001, with defector Des Lynam resuming the role he played so successfully with the Beeb.

His successor on Match of the Day, Gary Lineker, was clearly upset last night as he said: 'It's desperately sad news, a massive disappointment. But that is the state of the world - money tends to speak.'

The former England star signed a £1million, four-year deal to present the flagship show only last year, but his future with the BBC now looks in doubt.

The BBC had bid £40million a year - twice as much as it pays now - to keep the highlights for another three years.

But ITV offered £63million a year. Sky TV paid a reported £1.1billion to retain the rights to show live football while cable TV giant NTL won the chance to show 40 pay-per-view matches with a bid of £328million.

The shattering blow for the BBC follows the loss of a long list of sporting events, including the FA Cup Final, Test cricket, Formula One motor racing and horse-race classics.

Only last month, on the day of the FA Cup Final, the BBC humiliatingly had to drop its regular Grandstand programme because it had no live sport to show.

Former BBC managing director Sir Paul Fox said: 'This is the worst blow of all. Match of the Day has seemingly gone on for ever. Money is obviously a major factor, but the loss of Des Lynam has something to do with this. ITV were smart when they took him along with them for their interview.'

Lynam himself said: 'I am thrilled to be reunited with the Premier League.'

The news brought sharp criticism of Mr Dyke. The former ITV executive won the battle to become director-general partly because of his commercial 'nous' and BBC insiders had expected he would resurrect their sports department.

Shadow Culture Secretary Peter Ainsworth said: 'This raises questions about the BBC's leadership and the competence of its management.

'I don't know how Greg Dyke can reconcile this loss with his statement that Match of the Day was going to be his priority. He has obviously massively miscalculated.'

But Mr Dyke insisted the BBC could not have done any more. He said: 'We believe the BBC's bid was fair and reasonable and it was the highest we could afford to offer.'

BBC insiders stressed that ITV could raise extra cash from prime-rate advertising during the show - which regularly pulls in seven million viewers - while the corporation's only source of money is from licence fees.

The BBC insisted that Match of the Day will not be killed off altogether - it has copyright on the name and is hopeful it can win rights to FA Cup matches and England internationals, which are also are up for grabs this summer.