"It is extremely disappointing, we performed so well and were probably better than Milan," Houllier told reporters after Tuesday's game.

"I am really proud of the players but just disappointed they didn't fight to the end and that they missed several chances," he said.

The French champions were a few minutes away from their first Champions League semi-final appearance on the `away goals' rule with the score tied at 1-1.

But their dreams were shattered by late strikes from Filippo Inzaghi and Andriy Shevchenko.

"We played very well in the first half but we weren't as good after the break. But Milan's goals came on the counter-attack -- they had three chances and scored three goals," the Frenchman added.

Houllier, who guided Liverpool to the UEFA Cup title in 2001, said he is happy with the level of improvement that Lyon has made over the years.

"We have made a lot of progress and matured. We proved we can compete with top clubs like Milan," he said.