Michael John Beeche, 31, of Mawarra Dve, pleaded not guilty to the murder of Noel Patrick Gourlay, admitting he stabbed Gourlay, but in self defence.

The trial began in the Ballarat Supreme Court last Wednesday.

Yesterday the victim's Haddon family expressed disbelief at the outcome.

When the verdict was delivered, Gourlay's mother collapsed in court and was taken to hospital for observation.

Gourlay, 22, died from massive blood loss after he was stabbed in the abdomen with a large kitchen knife at a Nicholson St property in Ballarat on March 17 last year.

The court heard the pair had spent the night drinking and socialising together but became involved in a heated argument before the stabbing.

Crown prosecutor Julian Leckie had told the jury Gourlay was being loud, abusive and threatening but not once did he touch anyone.

''He took a knife with the purpose of sorting him (Gourlay) out... and thrust the knife into a vital part of this man's body.''

''Beeche was angry, upset and inflamed by alcohol, but this does not excuse him...''.

Defence counsel John Smallwood QC said the jury had to decide what a reasonable person would have done under the circumstances while confronted with the ''extraordinarily violent threats and demands'' from Gourlay.

He told the jury that being responsible for the death of someone did not necessarily make someone guilty of murder or manslaughter.

During a recorded interview Beeche said he never meant to hurt Gourlay and was sorry for his actions.

Beeche said he feared for his own safety and took the knife to protect himself.

``I wish I'd never done it. I wish I hadn't got drunk. I wish I went straight home, I am sorry,'' he said.

The jury deliberated for 15 hours before returning with its decision yesterday morning.