Fox-Pitt, who won the Kentucky title in 2010 and 2012, launched a double assault on further honours in Lexington with the 44-year-old riding Seacookie and Chilli Morning.
He placed first with Chilli Morning after the dressage and tenth with Seacookie however he retired the former after it refused a fence during the cross-country a day later.
That left Fox-Pitt with just Seacookie and he improved six places to fourth following a faultless cross-country ride although Nicholson overtook him in top spot with Quimbo.
Fox-Pitt then pulled off a penalty-free round in the show jumping however it was not enough to overhaul Nicholson, who remained first with Quimbo and also finished third with Calico Joe.
Brit Fox-Pitt, who was part of the silver medal winning eventing team at the London 2012 Olympics, placed second as the defence of his Kentucky title fell just short.
It is not all bad news for Fox-Pitt though as he can still win the Grand Slam of Eventing despite losing at Kentucky, which in turn boosts Nicholson's own cause.
Fox-Pitt won Burghley in 2011 and Kentucky in 2012 with just a victory at Badminton last year needed for the Grand Slam however bad weather forced the cancellation of the latter.
But officials have determined that should Fox-Pitt win Badminton they will consider it winning the three events in succession, the stipulations needed for the Grand Slam.
However, with Nicholson having just won at Kentucky following on from his triumph at Burghley last year, the Kiwi rider is also in with a shout of the Grand Slam.
- Sports & Recreation