lol BB beat me to it.
To prevent damping off, there are a couple tricks that you can try in the future.

Start your seedlings in small pots not much more than 2 inches deep. Now, when you water them, you can actually stand them in a tray of water and let it be absorbed from the bottom, keeping the soil SURFACE much much drier. Excess moisture really contributes to that type of wilt- pythium, I believe- and it is DEADLY to seedlings.
Another thing to remember is that your seedling starting soil should be clean. Reusing soil may be okay for older plants but for seedlings it pays to pamper them.