Having gone undefeated the past four tournaments, Hakuho was widely expected to match and surpass Futabayama's record of 69 set from 1936-1939.
But Kisenosato had other ideas in the day's finale at Fukuoka Kokusai Center.
Hakuho got a slow jump at the faceoff and never really recovered as Kisenosato (1-1) charged forward in a relentless effort before shoving the yokozuna over the edge as the crowd went into a frenzy.
"I left an opening in my sumo today and couldn't grab the momentum," said Hakuho, who shook his head in disbelief after tumbling into the ringside seats. "I had 63 wins and I really wanted to keep the streak going. But I guess I got a little complacent. It's too bad but that's how it goes," he said.
The normally cool-under-fire Hakuho had obviously lost his composure as he tried in vain to thwart the attack with a throwing technique and inner leg trip before he was sent packing.
The 25-year-old began his remarkable winning run back in January with a victory over Bulgarian ozeki Kotooshu on the penultimate day of the New Year Grand Sumo Tournament.
Hakuho is the only yokozuna in sumo's elite makuuchi division and has completely dominated the sport since compatriot and former yokozuna Asashoryu retired in February.
He became the first man to win three consecutive titles with undefeated records at the Nagoya meet in July and surpassed Chiyonofuji's 53-bout streak en route to another perfect run at the autumn meet in September.
Hakuho, who is gunning for his 17th Emperor's Cup here, slipped to a 1-1 record at the 15-day meet. He still sits in second for consecutive wins on the all-time list.
Futabayama's record, which many have called unbreakable and comparable with Joe DiMaggio's record 56-game hitting streak that still stands today in baseball's major leagues, was set at a time when there were only two tournaments per year.
The legendary yokozuna went on a tear from the seventh day of the 1936 spring meet until he lost against Akinoumi on to the fourth day of the 1939 spring meet.
"Hakuho let him control the bout. But I have to take my hat off to Kisenosato, who wasn't afraid of a fight. I still have to say that 63 straight wins is simply magnificent. I'm even more convinced now how amazing 69 straight wins is," said Japan Sumo Association Chairman Hanaregoma.
In other bouts of note, Kotooshu (1-1) once again fell victim to Aminishiki (2-0), who sent his opponent reeling over the edge with a hard crunch seconds into the match, improving to a 15-10 career mark against the Bulgarian ozeki.
Local favorite Kaio, meanwhile, pumped up the crowd by tossing down Kotoshogiku (1-1) immediately after the faceoff to pick up his first win here.