By chief political correspondent Simon Cullen
The final vote on the bill introduced by Labor senators was 26 in favour and 41 against.The Australian Senate has joined the House of Representatives in voting down legislation aimed at allowing same-sex couples to marry.
Labor senator Penny Wong, who is openly gay, described the result as disappointing and a failure of the Parliament to remove discrimination.
"Despite the results in both the House of Representatives and the Senate this week, I believe we have achieved a great deal," she said.
Yesterday, just 42 MPs in the Lower House supported a private members bill put forward by Labor backbencher Stephen Jones while 98 MPs voted against.
The defeat of gay marriage legislation this week has prompted renewed debate about the merits of Commonwealth legislation to recognise same-sex civil unions.
Liberal MP Warren Entsch says he has a private members bill ready to go and is now considering whether to introduce it.
"What I've drafted is actually a civil partnerships bill," Mr Entsch told ABC Radio.
"It's two persons who are in a relationship as a couple regardless of their sex and who meet the eligibility criteria."
Mr Entsch believes the legislation would have a better chance of success than changes to marriage laws.
He has the support of Liberal frontbencher Malcolm Turnbull, who has previously argued that supporters of same-sex marriage should not allow "the perfect to be the enemy of the good".
But other gay marriage advocates disagree, arguing the move would just entrench discrimination.
"I will not support continuing discrimination against same-sex couples in this country and I will not support a civil unions bill," Greens MP Adam Bandt said.
"To put in civil unions would in fact be a step backwards."
'Let dust settle'
Mr Entsch says he plans to speak with his leader about the proposed legislation, but Tony Abbott has already expressed his concerns about the move.
"We really should let the dust settle on these parliamentary votes before we rush off and do something else," Mr Abbott said.
"The second point I make is that the constitutional prerogatives of the Commonwealth are in the field of marriage, and civil unions really ought to be the prerogative of the state parliaments.
"But I know I will continue dialogue with Warren (Entsch) and various colleagues on this subject."
Leading up to the vote, Liberal senator Sue Boyce said she was considering whether to cross the floor and support the same-sex marriage legislation.
The move would have gone against the Liberal Party's policy which defines marriage as between a man and a woman.
"If my vote were going to mean this bill passed, it would be an easy decision for me to say, 'yes, I'll cross the floor'," Senator Boyce told ABC News 24.
"But because of the way the Labor Government has brought this all on, we know that it's going to be lost."
In the end, Senator Boyce abstained from voting.
In declaring his opposition to the move, Democratic Labor Party senator John Madigan took a swipe at the campaign used by those advocating a change to marriage laws.
"Love is not and should not be a basis for any legislation," Senator Madigan said.
"Slogans such as 'equal love' and 'love does not discriminate' are based on a sentimentality that has little to do with love."
Labor MPs and senators were given a conscience vote on the legislation, resulting in colleagues arguing strongly against each others' positions.
Labor senator John Hogg is also the President of the Senate and rarely speaks during debates on legislation, but today he too declared his opposition to changing marriage laws.
"I have a deep-seated belief that marriage is between a man and a woman exclusively," he said.
"I utterly reject the offensive language of some of those supporting the bill that people who share my views are discriminatory or homophobic.
"This is absolutely nonsense of the first order and is a desperate resort to try and isolate those who don't share their views."
Despite the legislation failing to pass the Senate, same-sex marriage advocates say the debate has garnered public support for the change.