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Rampant Australia eased to a comfortable eight wicket win over England after bowling Paul Collingwood's side for an unimpressive 135, their lowest ever Twenty20 total.
Opener Matthew Hayden made 67 not out as Australia reached their target with more than five overs to spare, but both teams qualify for the knock-out stage as England have a far superior run rate to Zimbabwe.
But England will be chastened by being completely outplayed by a side that Kevin Pietersen had threatened to humiliate before start of play
Adam Gilchrist (45) and Hayden added 78 swiftly for the first wicket and captain Ricky Ponting made 20 as the result was never in doubt as Australia, humbled by Zimbabwe on Thursday, produced a vastly improved display in Cape Town.
But despite Andrew Flintoff finding some form with the bat, clubbing 31 off 19 balls, England were unable to dominate against some tight Australian bowling of which Nathan Bracken was the pick.
The fast bowler took three wickets for 16 runs in his four overs, while seamers Mitchell Johnson (3-22) and Stuart Clark (2-24) were equally impressive as the Australians put a stranglehold on the England innings.
England began poorly as Ponting made frequent bowling changes to upset the batsmen's rhythm and openers Darren Maddy and Matt Prior failed to find their touch.
Prior soon fell swiping at Johnson and was caught at deep mid-wicket, while Luke Wright failed for the second game in a row after edging Johnson behind for just three.
Darren Maddy also struggled to time the ball well, and was bowled by Clark off a free hit before mis-timing a slog straight to mid-off.
Paul Collingwood, the England captain, began to up the pace, hitting Andrew Symonds for successive fours. But after smashing Brett Lee over mid-wicket for six off a free hit in the 11th over he was out lbw next ball.
The onus then fell to Kevin Pietersen after setting himself up nicely alongside Flintoff, who hit Lee for successive boundaries.
But Pietersen was bowled by Bracken and although Owais Shah and Flintoff launched straight sixes off Symonds, the Lancashire all-rounder holed out to third man off Johnson, just when he looked set and Shah was caught by Michael Clarke at long on off Bracken.
The ever-economical Clark then snaffled Chris Schofield, and diverted a drive from Stuart Broad to run out Dimitri Mascarenhas at the non-strikers end.
Bracken wrapped up the innings by bowling Stuart Broad, leaving England seemingly short of a defendable total.
Needing an outstanding bowling display to prevent a hammering, England struggled from the start with Flintoff clearly hampered by his injured left ankle but battling through to claim one for 25.
But having decided to discard James Anderson in favour of Twenty20 specialist James Kirtley, England needed him to enjoy a vibrant return and instead he was restricted to one over which was mercilessly hammered for 17 runs.
Stuart Broad also struggled and his three overs went for 23 as Hayden and Adam Gilchrist forged a 78-run stand in 8.2 overs without giving a hint of a chance.
Their stand was broken with Gilchrist driving Chris Schofield's second ball to long on and Ponting gave Flintoff a sharp return catch.
They were the only moments of success for England, however, as Australia romped into the next round and declared themselves as a major threat for the remainder of the tournament.
Australia: Ricky Ponting (captain), Adam Gilchrist, Matthew Hayden, Andrew Symonds, Michael Hussey, Brad Hodge, Michael Clarke, Brett Lee, Mitchell Johnson, Nathan Bracken, Stuart Clark.
England: Paul Collingwood (captain), Darren Maddy, Matt Prior, Luke Wright, Kevin Pietersen, Andrew Flintoff, Owais Shah, Dimitri Mascarenhas, Chris Schofield, Stuart Broad, James Kirtley.
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