Real Madrid lost 1-0 away to Osasuna in Pamplona on Sunday night to fall seven points behind Spanish La Liga leaders FC Barcelona.
Javier Camunas' second half goal was the difference between the two sides in a competitive game in which Madrid were again below their best.
It is the second away game which Real Madrid had failed to win and given that Barcelona had dropped just five points all season, it will now be very hard for them to win the La Liga title.
Jose Mourinho's plans suffered a setback before kickoff as Xabi Alonso suffered from a fever. The midfielder dropped to the substitutes' bench and his place in the team was taken by Lassana Diarra
Real Madrid's Portuguese forward Cristiano Ronaldo (C) fights for the ball during the Spanish league football match Club Atletico Osasuna vs Real Madrid CF at the Reyno de Navarra stadium in Pamplona. Osasuna won 1-0.
The first half was an even affair as Osasuna made a huge physical effort to match Madrid, but although the visitors managed two shots on target, Osasuna keeper Ricardo Lopez was equal to them.
Meanwhile Osasuna looked to the aerial threat of Carlos Aranda and fit again Walter Pandiani, neither of whom stopped running all night and were a constant thorn in the side of the Madrid defense.
Madrid were missing the clarity of Alonso's passing in midfield and possibly paying for the effort of their Copa del Rey semifinal in midweek and although the start of the second half saw them look to press the Osasuna goal, none of their shots troubled Ricardo.
Javier Camunas put Osasuna ahead just after the hour. The Osasuna midfielder took a knockdown from Aranda and clipped the ball past Casillas. The Madrid players appealed for offside, but replays showed Camunas had been in line with the last Madrid defender.
That provoked a triple change in Madrid with Emanuel Adebayor coming on to make his Madrid debut along with Kaka and Alonso.
As the game drew on it turned into one continuous Madrid attack, but Osasuna were solid in defense and should have added a second after Aranda's run and pass set up Kritszian Vadocz, whose point blank shot was blocked by Alvaro Arbeloa with Iker Casillas well beaten.
Madrid's next league match is another difficult trip to play fifth placed Espanyol.