Since the introduction of the women's football programme in 1996, the US have won four of six Olympic titles, but on Wednesday they lost out to the team that knocked them out on penalties in the quarter-finals in Rio.
Sweden completed dominated the USWNT from the very first whistle to the last and the Megan Rapinoe-led side has much to improve ahead of their coming games against New Zealand and Australia if they want to win a fifth gold medal.
The loss ended a 44-match unbeaten run for the Americans dating back to the start of 2019. It was also only the second time they had lost a game in 90 minutes at the Olympics.
Sweden capitalised on their early dominance to grab a goal in the 25th minute when Blackstenius glanced home a header off a whipped cross from Sofia Jakobsson.
The US had barely managed to get out of its own half in this opening 45 minutes, much less get any sort of foothold in the game, with Sweden enjoying more than 60% of possession.
At the 55th minute mark, Blackstenius doubled her lead as she latched on to a loose ball after a Swedish corner caused mayhem in the US box and struck the ball past the incoming keeper onto the roof of the net.
To cap off the glorious performance substitute Lina Hurtig added a third for 2016 silver medallists Sweden when she headed home a Hanna Glas' cross.
After the match, US forward Rapinoe said, "They're (Sweden) one of the best teams in the world. There's really no time to dwell or think about if Sweden is living in our heads or not. We've got another game in three days."
Meanwhile, before kick-off, players of both teams took a knee to highlight racial injustice.
The International Olympic Committee has relaxed some of the rules for protests at the Games, softening a long-standing ban on political protests at the global sporting event.
Athletes will now be allowed to take a knee before play begins to highlight racial injustice, speak to the media and post online about their views, or wear clothing with a protest slogan at a press conference.
But political statements during events, victory ceremonies and at the Olympic Village are still off the cards, the IOC said.
"For us it feels right to stand up for human rights," said Sweden defender Amanda Ilestedt.
"For us it feels good to do, and something we stand for as a team."