A final version of a proposed $1.3trillion spending bill was agreed on Wednesday evening, with only a narrow 52-hour deadline before a government shutdown.
Trump has called for $1.6billion for 74 miles of border wall, with an extra $1.1billion for technology and other assets.
But instead, the “omnibus” bill gives $1.57 billion for barriers along the border but not for the new prototypes Trump had visited in California.
This did not stop the President taking to Twitter to boast, saying: “Got $1.6billion to start Wall on Southern Border, rest will be forthcoming.
“Most importantly, got $700billion to rebuild our Military, $716billion next year…most ever. Had to waste money on Dem giveaways in order to take care of military pay increase and new equipment.”
In another tweet, he added: “Democrats refused to take care of DACA. Would have been so easy, but they just didn’t care. I had to fight for Military and start of Wall.”
The money would fund around 33 miles of new construction in the San Diego area and the repair of about 60 miles of existing segments.
Negotiators also rejected Trump’s plans to hire hundreds of new Border Patrol and immigration enforcement agents.
Donald Trump examined prototypes of walls along the US border with Mexico as he declared the border the USA’s first line of defence to keep out illegal immigrants and drugs.
Standing by the prototypes for the controversial wall, Mr Trump told reporters: “The border will is truly our first line of defence.”
The Republican president is on his first visit the majority-Democrat state of California, where a lot of the resistance to his policies is based.
While standing next to the prototypes Mr Trump was accompanied by border officials, chief of staff John Kelly and Homeland Security Secretary Kirstjen Nielsen.
The £12.8billion funding for the wall has not come as quickly as supporters have hoped for after multiple immigration restrictions proposed by the Republican party slowed it down.
Mr Trump examined eight styles of walls before turning his focus to “sanctuary cities” – areas where local governments do not cooperate with federal immigration cities to deport illegal immigrants.
In San Diego, he said: “They shield criminals. You can’t do that.”
Last week, the Justice Department filed a lawsuit against the state of California for alleged violation the US constitution by passing laws protecting illegal immigrants.
Democratic Governor Jerry Brown has accused the Trump administration of “waging a war” on his state.