Anthony Joshua will rematch Andy Ruiz Jr in the UK in either November or December after his shock defeat.
The Brit made his US debut at Madison Square Garden in New York but was stopped in the seventh round.
Joshua dropped Ruiz in the third round but was then put down twice himself in the same session.
He took his time to recover and looked to have steadied the ship before he was dumped on the canvas again in the seventh.
Joshua rose once more but when he was dropped again, the referee waved off the fight.
Thanks to a rematch clause, Joshua will have an immediate chance to win back his belts, this time in his own backyard.
Promoter Eddie Hearn said: "We'll make the rematch in the UK in November/December, but tonight is all about Andy Ruiz.
"Now we'll see what AJ is about. He's got the heart of a lion, I'm sure he'll come back. Now we know what fight is next, and we'll see a huge rematch at the end of the year.
"Maybe this is what he needs. He'll have another shot at Ruiz later but he needs to win, it's a must win fight for him now.
"Andy Ruiz will believe he can win the rematch, AJ"s got to come back stronger, let the fire build inside him.
"He's a true, true warrior in this sport. He tries every day to rebuild.
"He will be devastated when this sinks in and he's got to use that hunger to win the rematch."
