The British No1 was playing his first event since splitting with coach Miles Maclagan and was looking to claim his first title of 2010.
But Queen’s Club champion and second seed Querrey proved too much for the Scot and despite Murray having a match point in the second set, the giant American eventually won 5-7 7-6 (7-2).
Murray, however, said he was pleased to have reached the final and believes that playing the tournament will stand him in good stead for upcoming events.
“If you take the circumstances into consideration I have to be happy with getting to the final,” said Murray afterwards.
“I had a good week, I enjoyed it. Each match I felt better physically. I played reasonably well, better than the other matches.
He added: “It was a pretty late decision to come here, so obviously I wanted to come and try to win this event, but you have to have realistic expectations.
“I wasn’t expecting to play my best tennis, but [to] try and play as many matches as possible.
“It’s a lot better playing tournaments of this calibre than practising with my friends in Miami.
“I’m glad I came and I played some good tennis, and definitely it’ll help me for Toronto and Cincinnati.”
MORE: The latest football news
MORE: The latest tennis news
BIOGRAPHY: Cesc Fabregas