The 36-year-old was emotional at the end as he lost in straight sets 6-4 6-2 6-2 in Melbourne.
Murray, a five-time finalist in Australia, has now lost eight of his last 12 matches and four on the bounce.
The Scot admitted before the start of the tournament that 2024 could be his last season before retirement and he bid a long and emotional goodbye to spectators after the defeat.
Murray waved to all four corners of the Kia Arena before making his way back to the locker room.
And Murray told reporters afterwards that it is likely to be his last appearance in Melbourne.
‘It’s definitely a possibility that will be the last time I play here [in Melbourne],’ said Murray.
Australian Open organisers infamously played a farewell montage to Murray during the 2019 competition, before the Scot was set to undergo hip surgery.
Murray has fought back from the potentially career-ending injury but said he would retire if he was no longer enjoying tennis this season.
But Murray had his serve broken six times by Etchevery, and he barely threatened the Argentine’s serve.
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