Silver also tumbled in tandem with gold.
The precious metal, which was rallying in a phased manner at the domestic market after the onset of global recessionary fears, lost almost 9 per cent since three trading sessions from its Tuesday''s record level of Rs 28,145 per 10 grams.
On the global front, gold came under pressure after a plunge in futures trading on the back of a strong set of US economic data and expectation of more Federal Reserve stimulus, along with second trading margin hike by the Chicago Mercantile Exchange Group (CME) leading to hectic profit taking by investors.
"The yellow metal may witness further fall as it is more vulnerable to global momentum where it is undergoing drastic correction on hopes of escaping recession," a commodity trader said.
Standard gold (99.5 purity) nosedived by Rs 1,840 per 10 grams to close at Rs 25,670 from Wednesday''s closing level of Rs 27,510.
Pure gold (99.9 purity) also plummeted by Rs 1,835 per 10 grams to end at Rs 25,795 from overnight closing level of Rs 27,630.
Silver ready (.999 fineness) tanked by Rs 3,785 per kilo to finish at Rs 60,545 from Rs 64,330 yesterday.
In Europe, spot gold was bid down at USD 1,711.99 in early trade and silver also quoted down at USD 39.16 an ounce.