Halilhodzic, who has been in charge of the team since June 2011, said that he takes "full responsibility" for the disappointing display in South Africa.
"We didn't play great football, but it's hard to blame anyone," said the Bosnian. "I made the choices. I take responsibility for what happened.
"Tonight was disastrous. I feel deeply ashamed. It's hard to analyse. Now we'll sit down and think about the future of Algerian football."
Algeria won the tournament for the only time in their history in 1990.