Luis Suarez made a spectacular return to action as his two goals gave Uruguay a 2-1 victory over England.
- Jolly: Defensive shambles hurts England
- Mitten: Uruguay attack sinks England
- Hodgson 'devastated' by defeat
- Rooney up to 4th in England goal standings
- Hoddle: England made a 'schoolboy error'
- Tabarez: Uruguay gave everything
In a nervy first half, there were chances for both teams. Wayne Rooney went close with a free kick and later saw a header come back off the bar while, at the other end, Cristian Rodriguez fired just over the bar.
However, Suarez -- who missed Uruguay's opening match through injury -- was the man to make the difference. Edinson Cavani clipped a ball over the top of the England defence and the Liverpool striker found the space to head beyond Joe Hart.
England pressed for an equaliser in the second half but struggled to find the inspiration to unlock the defence until a ball broke kindly for Glen Johnson to play in Rooney at the far post, and the MAnchester United forward tucked in for his first goal at a World Cup finals.
However, the lead did not last long and, when Steven Gerrard failed to deal with a long ball, his Liverpool club-mate Suarez raced away and powered in his second of the game to secure a valuable victory for La Celeste.
If Costa Rica and Italy draw on Friday afternoon, or the Central Americans beat Cesare Prandelli's team, England will be eliminated with one match to spare.
If Italy won both their remaining games, Uruguay, Costa Rica and England will be tied for second spot, provided that Hodgson's men win their final match.
That seems unlikely after the defensive performance shown here on Thursday night.
No team in World Cup history has gone through after two defeats, so England might as well start thinking about going home after next Tuesday's game in Belo Horizonte against Costa Rica.
England showed promise in their first match against Italy, but in Sao Paulo they came up against a rigid and bruising Uruguay defence.
They had their chances to take something from the game but, once again, the attack cannot be blamed for the result. England's defence looked susceptible to pace and Suarez, despite being half-fit, caused them problems all night.
Suarez's first touch was greeted by loud boos from the 8,000 England fans sporting red and white in the far corner of the stadium. Those supporters were made to endure a nerve-jangling opening 10 minutes as England started on the back foot.
Suarez's cross deflected off Gary Cahill's head and Hart almost spilled the ball into his own net, before the England goalkeeper nervously palmed away a Suarez corner. It was not the start England wanted.
The pressure lifted for a moment when Diego Godin was booked for punching Daniel Sturridge's through-ball. Rooney steadied himself and bent the resulting free kick over the wall and narrowly wide of Fernando Muslera's goal.
Uruguay soon had England rattled again. Phil Jagielka made a real hash of his clearance and the ball fell to Cristian Rodriguez, who belted a left-foot drive that flew an inch over.
Gary Cahill soon followed suit, making another poor clearance, but once again Uruguay could not capitalise.
A concerned Hodgson came to the edge of his technical area to bark orders to his players. It had little effect though as Uruguay continued piling on the pressure.
Cahill had to put in a last-ditch tackle to deny Edinson Cavani and the Paris Saint-Germain man then clipped a shot just over the bar.
Godin was lucky to stay on the pitch when his outstretched arm hit Sturridge in the neck.
Then came Rooney's big chance of the first half. The striker connected with Gerrard's free kick just under the goal frame, but his header struck the frame and bounced out.
Then, seven minutes before the break, Suarez struck. Gerrard lost the ball on the halfway line while England had men upfield and Uruguay hit on the counter. Glen Johnson gave Cavani enough time and space to curl a peach of a cross that looped over Cahill's head and Suarez did the rest.
England's defence again switched off after the break, allowing Cavani through, but luckily for the Three Lions, he shot wide. Rooney found space in the box at the other end of the pitch, but he could only fire at Muslera.
Hodgson brought on Ross Barkley, who immediately injected some life into the England midfield. Sturridge, Johnson and Barkley all entered the box, but nothing was working for England -- until Johnson went on a run down the right flank.
Johnson, who endured a difficult night, took one player on and slipped the ball through the legs of Alvaro Gonzalez to Rooney, who prodded home.
Hodgson leapt up in celebration and Rooney looked to the skies. England went for the kill. Sturridge broke into the box and was knocked to the floor by Alvaro Pereira, but the referee waved play on.
But with five minutes left Suarez struck the killer blow. Gerrard could only flick on a long punt and Suarez drove a low ball past Hart.
England threw everything they had at Uruguay -- Hart even came up for a corner -- but nothing worked and Suarez was held aloft by his jubilant teammates at the final whistle.