Leading US critics have questioned whether Hollywood is yet ready to give its biggest prize to a gay love story after the race drama Crash grabbed the Best Picture Oscar at the 78th Academy Awards last night.

Brokeback Mountain, the story of unfulfilled love between two gay cowboys that was nominated in eight categories, had been the runaway favourite for the award after cleaning up in the Golden Globes and Baftas.

But although it won three Oscars, including the Best Director award for the Taiwanese Ang Lee, the year's most talked-about film ended up losing on the final prize of the night.

"Perhaps the truth really is, Americans don’t want cowboys to be gay," said Larry McMurtry, the veteran Western writer who shared the award for best adapted screenplay.

Crash, a complex jigsaw about the lives of six ethnically-diverse people whose lives collide in a Los Angeles car accident, also won the Original Screenplay prize for its Canadian director, Paul Haggis.

Crash's ensemble cast includes Matt Dillon, Sandra Bullock and the British actress Thandie Newton. Its producer Cathy Schulman said the film had a message "about love, about tolerance, about truth".

It was a good night for the lovingly crafted films King Kong and Memoirs of a Geisha, which matched Brokeback’s achievement by picking-up three technical Oscars each, despite being overlooked in the acting categories.

British talent was well rewarded. Rachel Weisz picked up Best Supporting Actress, Nick Park’s Wallace and Gromit: The Curse of the Were Rabbit won Best Animated Feature Film (his fourth Oscar), and Six Shooter took the Best Animated Short for its director Martin McDonagh, the London-born playwright of Irish parents.

Weisz, 34, was rewarded for her performance in The Constant Gardener. The London-born actress, who is six months pregnant, called it a "tremendous, tremendous honour".

In the film, a political thriller set in Africa based on the novel by John Le Carre, Weisz played the wife of a British diplomat, played by Ralph Fiennes. She thanked her "luminous" co-star and Le Carré: "He wrote this unflinching, angry story and he really paid tribute to the people who are willing to risk their own lives to fight for justice. They are greater men and women than I."

But the Oscars saved their big surprise for the end. There were astonished gasps around Hollywood's Kodak Theatre as Jack Nicholson announced Crash's victory in the Best Picture category over hot favourite Brokeback.

No overtly gay love story had ever won a Best Picture statue and the critics immediately asked whether Oscar votes had not backed off from breaking that taboo.

"Film buffs and the politically minded will be arguing this morning about whether the Best Picture Oscar to Crash was really for the film’s merit or just a cop-out by the Motion Picture Academy so it wouldn’t have to give the prize to Brokeback Mountain," said Tom Shales of the Washington Post.

The Los Angeles Times critic Kenneth Turan saw Brokeback’s failure as a sign that Hollywood was not yet ready to grant the topic of homosexual love mainstream respectability.

"Despite all the magazine covers it graced, despite all the red-state theatres it made good money in, despite (or maybe because of) all the jokes late-night talk show hosts made about it, you could not take the pulse of the industry without realising that Brokeback Mountain made a number of people distinctly uncomfortable," Turan said.

"So for people who were discomfited by Brokeback Mountain but wanted to be able to look themselves in the mirror and feel like they were good, productive liberals, Crash provided the perfect safe harbour."

Accepting his Best Director award, Brokeback’s Ang Lee thanked the film's two lead characters, Ennis and Jack. "They taught all of us not just about gay men and women whose love is denied by society, but most importantly the greatness of love itself," he said.

Crash's win was the first time that an independent studio had picked up the top Oscar since Gladiator won for DreamWorks in 2001. The film was made by the Canadian-owned Lionsgate, costing about $6.5 million to produce and has already earned $53 million at the box office.

The award more than vindicated Lionsgate's decision to post DVDs to all 120,000 members of the Screen Actors' Guild, who account for more than a fifth of Academy voters.

But some of the film's backers are tied up in legal action over its profits and credits. Cathy Schulman and Tom Nunan, two of the film's producers are suing the financier Bob Yari, alleging in part that he withheld millions in profits.

Mr Yari, a real estate developer, has filed separate suits against the Producers Guild of America and the Academy of Motion Picture Arts and Sciences for allegedly denying him a fair procedure when they ruled against his producing credit on the film.

Philip Seymour Hoffman won the Best Actor award for his portrayal of the writer Truman Capote in the biopic Capote. Collecting the award, Hoffman said he was "overwhelmed, really overwhelmed".

Reese Witherspoon won Best Actress for her portrayal of Jonnie Cash’s wife June Carter in biopic Walk The Line - beating two British hopes, Keira Knightley and Dame Judi Dench. The 29-year-old also picked up the award for the evening's longest, most gushingly emotional speech.

"Oh my goodness, I never thought I would be up here in my whole life," she said. "My grandmother was my inspiration, and she taught me to have strength and self-respect and never to give those things away."

Not only did Witherspoon and Weisz win acting statues, they also fared well in the most competitive, and arguably most important, category: Best Frock.

Witherspoon caused a fashion flap at the Golden Globes in January when she turned up in a glittery Chanel cocktail dress that she told reporters was vintage, only to find out afterward that it was actually in from Chanel's 2002 collection and had already been worn out by Kirsten Dunst.

But Witherspoon set exactly the right tone of high style and retro glamour last night with an original Christian Dior gown from 1955 of heavily-embroidered shell pink silk with satin details and silver-threaded beading.

"I found it in a vintage store in Paris, and it’s mine! I worked with some wonderful people and they helped repair it and bring it back to its original condition," she confided backstage.

But there was no fashion shocker reminiscent of singer Bjork's bizarre "swan dress" several years ago. "She was trying on her Oscar dress and Dick Cheney shot her," joked Jon Stewart, the host.

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