Birmingham will "bounce back" from its failure to become the European Capital of Culture 2008, according to the bid team.
The competition has raised the national profile of the city
Culture secretary Tessa Jowell announced Liverpool as the winner on Wednesday morning.
Birmingham bid director Stephen Hetherington said despite not winning the title, he was proud to be among the leading contenders and the city was already a leading European cultural centre.
"We believe we put forward the most comprehensive bid, built upon the aspirations of the people of Birmingham and the West Midlands.
"Clearly we're disappointed at this decision, but it doesn't change the fact that we are already a leading European cultural centre."
Brian Woods-Scawen, chair of the Birmingham Bid Group, said Birmingham was already a European Capital of Culture based on the "creativity, innovation and world class events that are on offer."
"Taking part in the competition has reaped many positive rewards.
"It has helped draw the cultural community together across the region and it has raised the national profile of the city, shattering many of the outdated perceptions of this thriving cultural centre
"Despite not being the overall winning city, we will go forward as the city has always done, and deliver our exciting programme for 2008.
"We wish Liverpool every success."
The title for Liverpool is expected to attract more tourists, increase investment and create jobs as well as boost its profile.