The 17-time grand slam winner was unable to secure an eighth Wimbledon title but pushed the top-seeded Serb all the way in an epic affair on Centre Court.
Federer fell short in his 6-7 (7-9) 6-4 7-6 (7-4) 5-7 6-4 defeat as Djokovic picked up his second title at SW19 and returned to the top of the world rankings.
Despite acknowledging that Djokovic deserved his win, Federer, who produced a stunning five-game winning run in the fourth set to extend the match, spoke of his regret at not performing as well as he might have done.
"It was a match that had everything I think for the fans. I thought it was an interesting match. I don't feel I played my absolute very best," he said.
"I didn't break for three sets. But it was a great match and I enjoyed being part of it.
"I kept believing and trying to play offensive tennis. As you can imagine, I'm very disappointed not being rewarded with victory. Novak deserved it - but it was extremely close."
The defeat leaves 32-year-old Federer searching for his first slam title since Wimbledon in 2012.
Having helped banish the memories of his second-round exit to Sergiy Stakhovsky last year, Federer said he did not know whether he would contest another final at the grass-court competition.
"You could have asked me that question [after my first Wimbledon triumph] in 2003. You don't know. You just don't know ... [you have] just got to wait and see," he added.
"There's no guarantee you'll ever be there again - or maybe there's much more to come.
"I don't feel a huge threat [from younger players in the game]. They're all unbelievably strong - but they're also somewhat exchangeable.
"I feel like if I'm playing well, I can still control the field to a degree."