Up against the defending women's champions Australia, the Black Ferns were pipped at the post 19-26, as the Australians completed a hat-trick of Dubai titles.
The Black Ferns managed to get Michaela Blyde over for a hat-trick of tries, but the Australians responded with speed and power.
Australia co-captain Demi Hayes said: "It was always going to be a tough final, and credit to them, they are such a good opposition. So for us to come out on top today, it was a good win."
The Black Ferns dominated their semi-final against the USA, winning 36-0, a result capped by Tyla Nathan-Wong marking her 200th appearance with the final try.
New Zealand's All Blacks Sevens shook off their disappointments from the opening tournament in Hong Kong to get within a sniff of playing the final, only to be beaten by the eventual winners South Africa.
New Zealand lifted their place on the standings to seventh on 25 points, seven points behind South Africa (32) and behind Australia (32), France (30), Ireland (29), Fiji (27) and the USA (27).
New Zealand led 12-0, but the Blitzboks came back to win 26-19. Caleb Tangitau capitalised on respective breaks by Tone Ng Shiu and Leroy Carter to score twice, and was denied a third in first-half injury time when Siviwe Soyizwapi managed to get beneath him to prevent him grounding the ball for a first-half hat-trick.
South Africa got on the board at the start of the second half, but key passes by Che Clarke and Regan Ware produced a chance for Rokolisoa, who completed a long-range try.
However, with the scores tied at 19-19, Shilton van Wyk dived across the line in stoppage time to deny the Kiwis a final place.
Akuila Rokolisoa had a big tournament for the All Blacks, scoring six tries, including two in the bronze playoff win over the USA.
Earlier, New Zealand beat France 20-0 in their quarterfinal when scoring three tries, while Kurt Baker managed his first penalty goal in his lengthy Sevens career.
The teams head to Cape Town for another tournament at the weekend. The Black Ferns are in a pool with Fiji, Britain and Brazil, while the All Blacks Sevens are with Argentina, Kenya and Spain.