The Australia U23's led on two separate occasions but eventually suffered a 3-2 defeat at the hands of Mexico in the final fixture of their Marbella Training Camp on Sunday morning (AEST).
A brace from Daniel Arzani would prove to be not enough as goals from Angulo Uriarte, Alvarez Campos and an Aguirre Lara diving header with 12 minutes to play consigned Australia to a third narrow defeat.
While Mexico created a handful of half-chances in a physical opening, it was Australia who would take the lead from the penalty spot on 32 minutes.
From the second phase of a corner, Arzani plucked the ball out of the air with expert control and was brought down as he looked to take on his marker.
The 22-year-old stood up and cooly dispatched the spot kick into the bottom right corner - however Australia would not enjoy their lead for long.
Less than two minutes later, a quickly-taken free kick caught out the Australian defence, allowing for Uriarte to slot home past Ashley Maynard-Brewer.
1-1 is how the score stood at the interval before the side overseen by Gary van Egmond and Trevor Morgan regained their advantage five minutes into the second half.
An impressive burst of speed and skill from Southampton midfielder Caleb Watts saw him skip through a couple of opponents and instantly turn defence into attack, before playing a ball into the feet of Arzani who drove in a powerful effort from long range.
Mexican goalkeeper Magalon Velazquez failed to deal with the strike, spilling the ball into the post and eventually deflecting it into the back of the net.
However yet again, Australia would be reeled back in less than ten minutes later as Campos steered a low strike into the back of the net.
Australia then turned to their bench, introducing the likes of Ramy Najjarine and Nicholas D'Agostino in an attempt to turn the tides again.
However it would be Mexico who would find a decisive third goal as substitute Lara lashed home a strong diving header to grant the CONCACAF nation the lead for the first time.
Australia pushed hard in search of a late equaliser but it was not to be, as their Marbella Training Camp came to a close with another defeat by the tightest of margins.
Australia U23: 2 (Arzani 32', 50')
Mexico U23: 3 (Uriarte 33', Campos 59', Lara 78')
Australia Starting XI: 1. Ashley MAYNARD-BREWER, 3. Gabriel CLEUR, 4. Jay RICH-BAGHUELOU, 5. Dylan RYAN, 6. Tyrese FRANCOIS, 7. Anthony KALIK (C), 10. Panos ARMENAKAS, 11. Daniel ARZANI, 19. Ryan TEAGUE, 22. Connor O’TOOLE, 25. Caleb WATTS
Substitutes: 2. Doni GRDIC, 8. Nicholas D’AGOSTINO, 12. Jordan HOLMES, 13. Con OUZOUNIDIS, 14. John IREDALE, 15. Ramy NAJJARINE, 16. Nicholas PENNINGTON, 17. Marlee FRANCOIS, 18. Jacob CHAPMAN, 20. Murray MILLER, 21. Luka PRSO, 24. Marc TOKICH, 26. Kristian POPOVIC