"Our thoughts are with animal lovers across the country who have been affected by this loss, and confronted by the very real risks posed by racing to the horses involved", RSPCA Australia spokeswoman Jane Speechley said.
The Irish horse had earned more than $1.7 million in prizemoney.
Jockey Kerrin McEvoy celebrated his third win in the two-mile race, drawing level with active jockeys Damien Oliver and Glen Boss.
There were awful scenes as the horses passed the finishing post for the first of two laps when fancied global The Cliffsofmoher broke down mid-race.
Cross Counter's Melbourne Cup victory is the first by an English horse while it also ended the Godolphin stable and owner Sheikh Mohammed bin Rashid Al Maktoum's long quest to win the "race that stops a nation". I was back a bit further than I wanted but I knew I was full of running.
Wagering services run by Sportsbet, Ladbrokes and online betting exchange Betfair all went down, with punters temporarily unable to place bets on their smartphone apps or computers.
Tarps were set up on the track immediately after the race finished and it's understood trainers spent some time working on the horse before it was put down.
A win for Marmelo would have completed a dream run for jockey Hugh Bowman, who has enjoyed a marvellous ride aboard superstar mare and four-time Cox Plate victor, Winx.
"This is all down to Sheikh Mohammed".
"It's one of the top events in the calendar every year and we will be just as enthusiastic about going for it in the future. I knew that if he found the gaps, this horse has got the gears to pick up". Godolphin has won hundreds of Group I races around the world but before today had never won the big one in Australia, despite more than 20 attempts.
Sir Charles Road trainer by New Zealander Lance O'Sullivan was seventh, New Zealand bred Zacada was 13th and Who Shot Thebarman was 17th.
The fines of the jockeys for excessive whip use would add to the anger of animal rights activists who were outraged by the euthanization of The Cliffsofmoher, which shattered a shoulder bone early in the race.