The US television audience for the 78th Academy Awards was down by eight per cent compared with last year.
The ceremony, which saw Crash shock the favourite Brokeback Mountain by taking best film, was watched by 38.8m people, the third lowest audience in 20 years.
The three-and-a-half hour ceremony from Los Angeles was hosted by Jon Stewart, presenter of the satirical Daily Show.
According to the Nielsen ratings, the 2003 show got the lowest audience, with 33m tuning in.
Chicago was the big winner in 2003, grabbing six Oscars including best film.
Last year's ceremony, which saw boxing drama Million Dollar Baby take best film, drew 42.1m viewers.
Pundits had predicted that interest could fall this year due to the highbrow nature of the five movies nominated for best film - Brokeback Mountain, Capote, Crash, Munich and Good Night, and Good Luck.
Unofficial estimates put the UK audience for Sky Movies 1's live broadcast at 51,000 during the first two hours of its coverage.
The best actor winner Philip Seymour Hoffman is not a household name although Reese Witherspoon, who took best actress, has starred in blockbusters such as Legally Blonde.
Crash explores racial tensions in Los Angeles
No film swept the board, although three awards each went to Crash, Memoirs of a Geisha and the blockbuster King Kong.
Distributor Pathe will re-release Crash in 70 cinemas in the UK and Ireland this week, seven months after it was first released, following its Oscar success.
The ceremony received mixed reviews, with some US critics singling out host Stewart for attack.
Tom Shales, of the Washington Post, said as well as naming Crash as winner, the ceremony had been driven "into a wall".
He wrote: "It's hard to believe that professional entertainers could have put together a show less entertaining than this year's Oscars, hosted with a smug humorlessness by comic Jon Stewart, a sad and pale shadow of great hosts gone by."
The New York Times' Alessandra Stanley said Stewart "wasn't as funny as he is usually is" but added that he did produce some good moments.
Cintra Wilson, of website Salon, wrote: "How did Jon Stewart suck so hard?"
"These Oscars were so hideously uptight, they got pulled down a worm-hole and travelled light-years, on and on, forever, until they finally ended up in the darkest, airless regions of some fat, ultra-conservative's welded-on undershorts."
Ray Richmond, of the Hollywood Reporter, said the decision to play background music during the speeches was "monumentally distracting" and "supremely disrespectful".
He added that Stewart had got "just the right balance of reverence and smugness".
Film critics Robert Ebert and Richard Roeper, who host a movie review TV show, raved about Stewart's performance, with Ebert calling it a "home run".
Philip Seymour Hoffman won the best actor prize for Capote
Before 1993's low TV audience, the last Oscar telecast to draw a smaller audience was in 1987, when 37.2m people saw Oliver Stone's Platoon win best film.
Meanwhile, Palestinians held their first official Oscar party in Ramallah, in the West Bank.
People gathered to see if Paradise Now, a drama about two Palestinians recruited to carry out suicide bombings, won the best foreign-language film Oscar.
It missed out to South Africa's Tsotsi, which centres on a young gangster who fends for himself in a shanty town just outside Johannesburg.