The 35-year-old produced a patient yet invaluable knock of 71 off 147 balls, which included a final wicket partnership of 65 with James Pattinson, to get his team within 15 runs of what would have been a historic victory.
His efforts left the England fans nervously clinging to their seats at Trent Bridge on Sunday and only a review at the death handed glory to the hosts.
"Memories of the Ashes in 2005 came flooding back and having to live through it all over again," Atherton told Sky Sports. "There was so many twists and turns but what an innings it was by Haddin.
"He's a superb cricketer and has a wonderful temperament. It ended in controversial circumstances and Haddin was distraught. Haddin played a remarkable innings but it wasn't enough.
"He can be very proud with the way he's played and appeared taking his side to the brink of victory. Well played Haddin, well played Pattinson and well played Australia.
"The crowd couldn't believe what they witnessed. Once that last decision came through all the tension drained out of their bodies. Both teams will look back at all the controversial moments but everyone has witnessed an astonishing Test match."
The Australian captain Michael Clarke insisted his players could "hold their heads up high" after their valiant efforts throughout the five days and highlighted the efforts of his veteran batsman Haddin.
Andrew Strauss said the innings of the batsman who comes in at seven was unbelievable, while Nasser Hussain added: "Haddin's character is his strongest thing. If Australia could have chosen someone for that situation, it would have been him.
"He played it sensibly and got himself in. He wasn't slogging it from the first over and the longer he was in his timing just got better - particularly on the leg side. He is very well balanced at the crease and he can play just as well on the leg side and off side."
Watch the second Test from Thursday 18 July from 10am on Sky Sports Ashes HD, on the Ashes Event Centre - available via the Sky Sports App - and with a NOW TV day pass.