That led to the, possibly apocryphal, line attributed to Waugh, "you've just dropped the World Cup", to Gibbs.
Even so, South Africa seemed set to progress to their first final when they faced the Aussies again at Edgbaston four days later.
The format was such that in the unlikely event of a tie, Australia, based on events earlier in the Cup, would advance to the final.
Everything seemed to be going South Africa's way as they dismissed Australia for a meagre 213 in which only Waugh and Michael Bevan got past 40. Shaun Pollock (five for 36) and Allan Donald (four for 32) held sway with the ball.
Watch highlights of the match:
South Africa, after overcoming early difficulties at 61-4, seemed to be cruising to victory with five wickets standing and Jacques Kallis well set. When Kallis fell at 175, only 5.1 overs were left and 38 needed.
Click here: Match scorecard
Three more wickets fell in quick order, leaving 15 needed from the final eight balls. Lance 'Zulu' Klusener was still there with last man Donald.
Klusener was a thunderous hitter and clobbered Glenn McGrath for a six - through Paul Reiffel's fingers at long on. Nine were needed from the last over.
The powerful Klusener then appeared to have removed the drama by smearing boundaries through the off side off Damien Fleming's first two balls.
Next ball, the jittery Donald should have been run out backing up too far. But madness had set in.
Klusener hit the next ball back past the bowler and sprinted to the danger end. He would have been easily run out had the throw hit the stumps. Donald, meanwhile, had failed to respond, then dropped his bat and was run out by half the pitch.
Australia clutched each other in delight. South Africa contemplated a massive failure, and it has become Exhibit A in the prosecution case over the chokers' tag.
