Rabbitohs coach John Lang admitted the Knights blew them off the park in Friday night's eighth place 40-24 decider at Ausgrid Stadium.
Newcastle, playing in front of a season-record of 30,729 fans, produced a dominant first half performance running in five tries to one for a 30-6 half-time lead.
The Knights extended their lead to 34-6 after 50 minutes before Souths fashioned a thrilling comeback to reduce the margin to just 10 points with three tries in 16 minutes, including a double to the NRL's leading try scorer this season in fullback Nathan Merritt.
But time ran out for the Bunnies and the Knights sealed the win and a semi-finals berth when State of Origin winger Akuila Uate ran 85 metres after an intercept to bag his fourth try of the match for a 40-24 win.
"I thought they played tremendously well, especially for the first 60 minutes," Lang said of the Knights' performance.
"They didn't drop off that much but we started to throw the ball around and passes started to stick in the last 20 minutes."
"But I thought they were outstanding and it is a great credit to them and to their coach to get them up after such a disappointing loss last week."
"We made errors coming out of our own end and we couldn't defend them. They blew us off the park."
Souths captain Michael Crocker agreed that the Knights seemed to have more desire to win, perhaps boosted by the sold-out home crowd, but the representative forward said he was proud of the never-say-die attitude of his team to try to force a miracle comeback in the second half.
"I think they just wanted it more," Crocker said.
"They played a lot smarter than us. It was the same as last week."
"I don't know if we panicked a bit but we went away from our normal game plan – we thought we had to try too hard and we kept giving away the ball and didn't build pressure and they capitalised.
"They had the home crowd but it is difficult to explain…it was disappointing."
"But it was gutsy of us to come back in the second half," Crocker added.
"We could have given up at any stage in the second half there, but we kept fighting and with six minutes to go we were still in with a chance."
"We have got to take the positives out of that and learn a lesson and hopefully we can keep building on what we have achieved in the past few months and use that for next year. "
Crocker admitted that he thought his side was still in the match at half-time despite the 24-point deficit but they needed to be first to score in the second half to ignite a come-from-behind win.
"It was hard when you are down by so much but with six minutes to go we were only down by 10, so we thought we were a chance," he said.
"We know we can score points, we just have to build pressure and we did that a little bit and started coming up with opportunities but they were too good in the end."
The loss ends the Rabbitohs' spirited charge for the finals after an amazing past eight weeks of results that has seen the club come from nowhere to the brink of the top eight.
Lang, who was coaching his