The world number one looked to be heading for the title during tonight's final when she served for the match at 5-4 in front against Serena Williams in the decider.
However, Williams recovered to win the next three games in succession to claim the fourth US Open title of her career.
"Serena deserved to win and she showed what a true champion she is. I'm just honoured to be standing next to her," Azarenka said during her post-match interview.
"I gave my all and stepping off the court I will have no regrets."
Despite the defeat, Azarenka will remain top of the WTA rankings.