The singer said he was "devastated" after his journey came to a premature end on Sunday night.
Shayne and partner Maria Filippov faced former Eastenders actor Matt Lapinskas and his partner Brianne Delcourt in the skate-off.
The contestants ended up in the bottom two after the judges' scores were combined with viewers' votes.
"These are two names I didn't think I'd be reading out at this stage of the competition," host Phillip Schofield admitted.
Earlier the celebrities both impressed the judges with their 'Leveller' performances which saw them skate alone, without their professional partners.
Shayne scored 23.5 out of a possible 40 while Matt scored 28.
After his first dance, Head Judge Robin Cousins told Shayne he was "almost more comfortable" on his own on the ice than when he was dancing with his partner.
Former Pussycat Doll Ashley Roberts said: "I never thought I'd be turned on by a man in a pink bedazzled shirt but I think that might have happened tonight".
Matt was praised for putting on a performance that was "unlike anything we've ever seen on the show", according to Jason Gardiner.
Dressed as a black swan, he was told his performance was "amazing".
Oh drama baby, yeah! I was amazed and you give me goosebumps.
Matt later stumbled in the skate-off, leaving him to weep on the ice-rink - while Shayne delivered a step-perfect routine.
Matt's partner said: "He got right back up and went into a lift."
Mentor Christopher Dean also commended him, adding: "You recovered fantastically well."
His recovery was enough to save him, with Robin saying the two dances "could not compare".
Judge Karen Barber found the decision difficult and said: "Well, this is a skate-off that should never have been."
After the result, Shayne said: "I'm absolutely devastated. Thank you so much, you've been an amazing bunch."
Olympic gymnast Beth Tweddle and her partner Dan Whiston topped the leaderboard, scoring 30.5 points out of 40.
Meanwhile, Coronation Street star Samia Ghadie and her partner Sylvain Longchambon fell to the bottom of the scoreboard with a disappointing 18 after their routine to a Little Mix song failed to impress the judges.
Jason described it as "uninspired", telling Samia: "We can now see that you are very much reliant upon Sylvain."
"To be fair I don't think they were that harsh because I was really, really nervous," the actress said.