Canada's Michelle Li proved far too strong for the home favourite, winning 21-14 21-7 in just 38 minutes.
Gilmour, 20, became the first Scottish woman to reach a commonwealth badminton singles final with victory over Tee Jing Yi of Malaysia.
But she had to settle for silver, Scotland's 53rd medal of the Games.
"It was almost perfect but I think I just gave so much yesterday (in her semi-final)," the number two seed told BBC Scotland.
"Mentally, I wasn't all there today. I couldn't quite get all my focus together.
"The legs and the head just didn't quite match up. Physically I feel ok, the head just didn't quite engage.
"But, a silver medal, I'm not complaining at all.
"It's been such a long time coming and to come out at the other end with a medal of any colour - I'm just so happy."
On Saturday, Imogen Bankier and Robert Blair took bronze in the mixed doubles event.
"The emotional side was the tough part," Blair told BBC Scotland after the 21-17, 21-11 win over Malaysia's Chan Peng Soon and Pei Jing Lai.
"To have your hopes of winning bashed is so disappointing and you have to pick yourself up again.
"But, thankfully, we managed to get ahead and they seemed to give in a bit."
Bankier and Blair lost their semi-final to eventual gold medal winners Chris and Gabrielle Adcock.
"We were outplayed," conceded Bankier, who partnered Chris Adcock at the 2012 Olympics, "We felt we hadn't played our best badminton, so to come back and play against a good pair was very challenging.
"But I'm absolutely delighted (with a bronze medal) and it's great for the sport."
Scotland's Kirsty Gilmour slumped to defeat in the gold medal match of the women's singles badminton at Glasgow 2014.