Giampiero Ventura's side were lambasted in the press Sunday for his tactics but also individual performances including midfielder Marco Verratti and veteran goalkeeper Gianluigi Buffon.
"Ventura, what is this Italy?" headlined the Corriere dello Sport which summed up the bitter disappointment after the previous night's showing at the Santiago Bernabeu.
"Little Italy, Russian roulette," the newspaper continued on its inside pages as Azzurri trailed not only in fitness but quality.
The clash was between the top two teams in Group G but the difference in class was evident with an Isco brace and Alvaro Morata putting Spain three points ahead with three qualifying games left.
The defeat was Italy's first loss in either World Cup or Euro qualifying since September 2006, a run of 56 matches.
Italy now need Spain to lose one of their remaining qualifying games against Liechtenstein, Albania or Israel to have any hope of avoiding a double-headed playoff.
The performance was a far cry from just over a year ago under Ventura's predecessor Antonio Conte who lead the Italians to a 2-0 win over Spain in Euro 2016.
Former Torino coach Ventura was slammed for his 4-2-4 system which fell with Daniele De Rossi and Verratti under constant attack in midfield.
But it was a series of embarrassing errors by Verratti which drew scathing criticism, with 39-year-old Buffon also in the firing line.
"Bad evening or decline? Time passes and reactions and reflexes are no longer the same," wrote la Gazzetta of the veteran goalkeeper.
"Right now we are human and Spain are less human," said Ventura as he turned his attention to Tuesday's qualifier against Israel which will be followed by games against Macedonia and Albania in October.
"We gifted them some situations and helped them out. If one match hits our self-confidence, it means we are not competitive, so I cannot believe that."
Italy now face a play-off in November with Sweden, Greece, the Republic of Ireland and Northern Ireland possible opponents. The last time Italy had to go through the play-offs was in 1997 on the road to the 1998 World Cup in France.
And one who will remember that is Buffon, who had just got first cap during the away leg play-off in Russia, and remains confident this time out.
"We believe and hope to go to the World Cup," said Buffon. "There is a year ahead of us, there will be training camps to refine certain mechanisms. There are values in this squad that don't always emerge."