Though Australia moved up from 48 to 45 on Thursday, Milligan's hopes of signing a deal with Championship club Bolton Wanderers hinged on the green and gold holding an average ranking inside the top 50 over the past two years.
But that has not been the case, with Australia dipping into the 60s on occasion, leaving Milligan, 31, short of the necessary work permit requirements and with few grounds for appeal amid stifling regulatory red tape.
Bolton were the front runners for Milligan's signature, having been impressed with his displays at the Confederations Cup, where he twice wore the armband for Australia.
The utility was desperate to play in England, having had a move to Crystal Palace thwarted by Melbourne Victory in 2013.
It's understood that he may now head back to the A-League, and a possible second spell with Victory.
There are, however, other offers in Portugal and Denmark on the table should there be no way of convincing the FA to look again at his case.