South Africa were better team - Collingwood
Paul Collingwood admitted England had played "some bad shots" as their lowest total in Twenty20 internationals was easily picked off by South Africa.
All out for 111, England lost their first Super Eight tie by seven wickets.
Collingwood told BBC Sport: "It was a combination of some bad shots and some excellent fielding by them.
"Some of the catches they took, and their energy in the field, shows where we need to be in the next two games. They created so much pressure."
The disjointed batting performance, with only three people reaching double figures, was reminiscent of the 99 all out in the $1m Stanford Super Series match last November.
The team has been modified considerably since then, and England posted an impressive 185 in beating Pakistan last Sunday.
But it was back to the same old problems against a strong South Africa side who many are tipping to go all the way this time.
Collingwood said a score of 150 would have been a good total and went on: "Credit to them, they kept us to a total which - if we were to defend it - everything was going to have to go right.
"All their fielders put us under pressure. It's amazing how much pressure diving stops and one-handed catches can create.
"There were one or two positives - the way Dimi [Mascarenhas] bowled again and the way we took them down to the 19th over."
He defended the selection of wicketkeeper James Foster at number six.
"Fozzie has been very good for Essex with his run-scoring but it's the top five batters who have to score the bulk of the runs."
Collingwood added: "Tonight we were outclassed - and we've got to make sure we're not outclassed again in this competition."
Smith hails South Africa fielding
South Africa skipper Graeme Smith was delighted with his side's all-round effort and had words of praise for 19-year-old fast bowler Wayne Parnell, who took 3-14 from 3.5 overs.
He said: "The intensity we created in the field was great and then we clinically finished the game off.
"Wayne is handling himself very well. He is composed, it was a cauldron to be playing England over here but he handled it very well..
"We're a talented team with a great blend of youth and experience and we squeezed them. Today was a big game for us, playing England in England in a competition like this.
"But we knew there was a lot of pressure on them, with a big crowd - and everything we spoke about tactically today worked for us."
All-rounder Jacques Kallis was named Man of the Match after taking 2-20 and then hitting an unbeaten 57.
Kallis was omitted from South Africa's squad from the 2007 tournament - but denied his performances in the current tournament were proving a point.
"That is not why I play cricket. I play cricket because I enjoy it and I enjoy playing for the Proteas and also to prove to myself that I am capable of playing all formats at this level.
"I have worked hard with (coaches) Duncan Fletcher and Mickey Arthur and I also gained a lot by doing well in the recent Indian Premier League," he said.
He struck a six and five fours during his 49-ball innings and added: "I knew that if one of us batted through and scored a run a ball and everybody else batted around him that we would win the match."