Madrid's 2012 bid leader Feliciano Mayoral believes the city should try for the 2016 Olympics because of the example of London.
"I think we could win if we tried again but no one can guarantee that," he told sports daily Marca's website.
"We would need a good international lobby to sell Madrid's 2016 bid.
"When a bid like London's wins, with little popular support and a lot of money still to be spent, it's because it has done well lobbying."
Madrid fell in the third round of voting in Singapore last week, when London was selected as the host city for the 2012 Games.
Madrid beat New York and Moscow into third place but fell two votes short of Paris going into the fourth and final round of voting.
"Never in the history of the Olympics has a city had 32 votes in the second round and lost," he added.
"We had everything done and the highest level of support among the cities' populations.
"If it were up to me I would say we should get straight back into the running for the next Olympics."