An extraordinary uppercut in eighth round left Saunders leaving the AT&T stadium and heading straight for hospital.
The Englishman was clearly hurt but made it to the end of round eight before he had to quit on his stool with eye extremely swollen and puffy.
The judges had all scored the fight with Canelo Alvarez leading against Billy Joe Saunders
The scorecards with the judges had, up to that point, had Saunders in with a shout but the scoring from all three narrowly had Canelo in the lead.
All three had also scored the first and the fifth round in favour of Saunders, with all of the six others going the way of Alvarez.
Glen Feldman and Max DeLuca both had totted up a sore of 74-78 to Canelo, while Tim Cheatham had it a little bit closer on 75-77 at the time of the stoppage.
While it was an uppercut that won it, Canelo had looked to hit Saunders with a number of bodyshots in their fight up until the eighth round.
Saunders, meanwhile, had boxed smartly around his jab and in the fifth round particularly, had kept busy and caused Canelo problems.
Canelo had been made to graft by Saunders until he got him hard in the eighth round
Many had tipped Saunders to have the skillset to trouble Canelo, but speaking in the aftermath the Mexican dismissed the idea that he had faced much difficulty against Saunders.
‘I said it would be around round eight. It was not as difficult as I expected and that is because of my preparation.
‘I think I broke his cheek and I knew he wasn’t going to come out. I told my corner he’s not coming out because I broke his cheek.
‘I have the best trainer. I prepare, he says “do this” and I do it.’