Borders 16 (6)
The Ospreys celebrate with the Magners League trophy
Pens: MacRae 3.
Ospreys 24 (14)
Tries: Tiatia, Parker 2.
Cons: Hook 3.
A nervy Ospreys took the Magners League title after beating a Border Reivers side determined to go out with their heads high before being disbanded.
When Sonny Parker added his second try to Filo Tiatia's fifth-minute opener it seemed the Ospreys were home and dry.
But Borders, with Calum MacRae's boot to the fore, launched a late fightback through prop Ed Kalman's try.
MacRae's conversion and penalty brought Borders within five, but James Hook's late kick sealed the Ospreys' title.
The result was a blow to Welsh rivals the Cardiff Blues, whose win over title contenders Leinster had sent them to the top of the table on Friday night.
Naturally we are thrilled - but it is hard to celebrate when the team we faced are going out of existence.
But Dai Young's players had to watch helplessly as events at Netherdale unfolded and the Ospreys leap-frogged the Blues to take the title by a point.
It took the Ospreys just five minutes to settle any nerves with their opening try as Tiatia went through a hole in the Scottish defence to go under the posts, handing Hook an easy conversion.
The Kiwi number eight had opted to charge between both Borders props, but could not have expected to canter through untouched as Gavin Kerr and Bruce Douglas left the tackle to each other.
The Borders were determined not to go out with a whimper, however, and should have had a try of their own soon after.
MacRae was stopped just short of the Ospreys line but, after a scramble involving Ospreys scrum-half Jason Spice, Nick De Luca appeared to have touched down for a try only to find referee Alain Rolland unsighted.
A penalty from MacRae soon after got the Reivers moving on the scoreboard, but the Scots were forced to dig deep to keep the Ospreys at bay as the half progressed.
Shane Williams looked certain to score on the right only for a Borders arm to slap the final pass down.
Some officials would have given a penalty try, but after consultation Mr Rolland only gave a penalty and Borders survived.
The Scots looked to have lifted the siege after winning a five-metre scrum against the head and kicking themselves upfield.
But the Ospreys recycled well on halfway, before Hook dummied and jinked his way through to send Parker under the posts for another seven points.
MacRae added a late penalty but the Ospreys still held a 14-6 lead at half-time.
A break from wing Williams soon after the restart allowed Parker to slide in at the left wing for his second try, Hook adding a fine touchline conversion.
Former Scotland back Gregor Townsend retired after the match
But if the Ospreys thought the job was done they were soon given a nasty wake-up call as Borders came roaring back.
Gregor Townsend, in his last game before retirement, sparked a move that saw replacement prop Kalman crash through.
MacRae added the tricky conversion and then a penalty from in front of the posts to cut the Ospreys' lead to just five points with 10 minutes remaining.
Richie Pugh had a golden chance to settle Welsh nerves after breaking clear down the left wing.
But the open-side panicked as Stuart Moffat closed him down, hurling a pass over his shoulder that Williams had little chance of fielding.
A cool long-range penalty from Hook at last restored the Ospreys' breathing space and the Welsh flopped over the finishing line to claim their second Celtic crown in three years.
The contrast of the Welsh celebrations with their opponents was marked.
The Scots trudged off the Netherdale pitch for the last time as Reivers players, their team a victim of cost-cutting, and Townsend for the last time as a professional.
Ospreys coach Lyn Jones:
"Naturally we are thrilled - but it is hard to celebrate when the team we faced are going out of existence.
"Borders produced a really brave performance, as we knew they would, and we feel for them.
"The feeling is more of relief than anything else. We have lost twice recently at this venue, so we took nothing for granted."
Borders coach Steve Bates:
"Again, I was extremely proud of the lads for the effort they displayed in very difficult circumstances.
"Their attitude was all that professional sportsmen should be."
Border Reivers: Stuart Moffat; Dougie Flockhart, Calum MacRae, Nick De Luca, Garry Law; Gregor Townsend (capt), Rob Chrystie; Gavin Kerr, Ross Ford, Bruce Douglas, Stuart Grimes, Opeta Palepoi, Scott Gray, Andy Miller, Kelly Brown.
Replacements: Steve Scott for Ford (60), Ed Kalman for Douglas (60), Craig Hamilton for Palepoi (65), John Dalziel for Gray (65)., Brendan McKerchar for Chrystie (60), Steve Jones for Townsend (79), Bryan Rennie for Flockhart (62).
Ospreys: Lee Byrne; Nikki Walker, Sonny Parker, James Hook, Shane Williams; Shaun Connor, Jason Spice; Duncan Jones (capt), Huw Bennett, Adam Jones, Brent Cockbain, Alun Wyn Jones, Jonathan Thomas, Richard Pugh, Filo Tiatia.
Replacements: Richard Hibbard for Bennett (61), Paul James for Adam Jones (74), Mike Powell for Cockbain (57), Lee Beach for Tiatia (55), Martin Roberts for Spice (74), Andrew Bishop for Connor (52), Jonathan Vaughton for Walker (73).
Referee: Alain Rolland (IRFU).