Catryn Jenkins BBC News Online

The crowd packed the lobby to hear the result

The crowd, which had packed into the small lobby of the city's Old Library, stopped talking about whether Cardiff or Newcastle-Gateshead was going to clinch it while Culture Minister Tessa Jowell was beamed onto two widescreen televisions.

Her announcement that Liverpool was the winner shocked the Cardiff crowd into a loud collective groan, then a stunned silence before someone started a congratulatory applause for the Merseyside city.

It was a shock. No-one was expecting that outcome - people there thought that if Cardiff did not get it then it would almost certainly go to Newcastle-Gateshead.

But after the news had sunk in, some of the crowd admitted that they weren't all that shocked about Cardiff not winning after all.

Captain and Dregz said the city was up and coming

Hiphop band members Dregz and Captain - who had performed before the announcement - said that they weren't that shocked.

"I had a feeling that Liverpool would get it, but I would have liked to have seen Cardiff get it," said Dregz.

"It was the right time for us to have gone for it and get it because we have a lot of cultural heritage here and the city is really up and coming," he added.

The team behind Cardiff's bid were naturally disappointed but Bet Davies, the director of marketing for Cardiff 2008, said that efforts were going to be concentrated on promoting the city.

"Because we made it as one of the short listed cities, we will receive �6m to have a marketing campaign across Europe," she said.

Andree Morgan Andrews was shocked at the news

"And of course we have the celebration in 2005 of 100-years of Cardiff being a city and 50-years of it being made the capital of Wales.

"Nothing has been lost today but the team are all disappointed because we have all put our lives on hold during the bid process.

"It was more than just a job to us," she added.

Her let down was echoed by Andree Morgan Andrews, who works for Promo - an organisation which promotes young people's artistic talents.

"I am disappointed and a bit shocked and surprised," she said.

"I honestly though that Cardiff had the greatest chance even though some people were thinking that Newcastle-Gateshead would have got it," she added.

But in the city centre, not many people were aware of the result or even that Cardiff was in the running for the title.

Andy Tucker who runs a street flower stall said: "I don't think Liverpool should have won it but I'm not sure many people in Cardiff will care about it anyway.

Lynne Edmonds is impressed with Cardiff

"I don't think many people in Cardiff knew it was going on," he added.

When Lynne Edmonds, who was brought up in Cardiff until the age of 13, was told of Liverpool's success, she said she believed that Cardiff should definitely have won the title.

"I have come back to Cardiff after 20 years and can't believe how much it has changed," said Ms Edmonds, who now lives in Devon.

"It is so much better here now, I love it. I always think of Cardiff as my home.

"My son goes to university here and he just doesn't want to leave the place," she added.