The Lions missed the chance to secure a home route to a possible Super Rugby final after they went down 34-22 to the Jaguares at Vélez Sarsfield.
Johan Ackermann's outfit will now play host to the Crusaders next weekend, with the Hurricanes handed a home game against the lowest seed, the Sharks, after finishing the regular-season top of the overall standings.
Ackermann, who had rested his first-choice XV to keep them fresh for the knockout stage, may now be regretting his selection decision.
The visitors in fact led at the break but in the end the power of the Jaguares shone through, as tries from number eight Facundo Isa and lock Mattias Alemanno came either side of a penalty try in the second stanza.
Scoring for the Lions was Anthony Volmink (2) and Sylvian Mahuza as they now head back to Johannesburg to prepare for next week.
Due to unexpected results in New Zealand earlier in the day, the Lions knew a minimum of a bonus-point would see them finish on top.
Few had given them a chance of getting the win in Argentina, but this second-string side silenced their doubters in the first-half as they went into the break leading 12-15 thanks to tries from Volmink and Mahuza. Fly-half Jaco van der Walt kicked over one conversion and a penalty.
They began strongly and led inside three minutes when Van der Walt stepped up after a ruck offence. He made no mistake from in front.
Jaguares fly-half Nicolás Sánchez responded two minutes later after Lions prop Corné Fourie was pinged at the ruck by Rohan Hoffmamn.
But then came the first try of the contest and it went the way of the Lions as captain Ross Cronjé set up Volmink down the left for 3-10.
Jaguares fans appeared shocked by the score but were warmed by two Sánchez kicks, in the 16th and 25th minute, that made it 9-10.
Again though the Lions landed a significant blow and this time it was a lovely offload from flanker Robert Kruger that set up the score down the left sideline, with full-back Mahuza enjoying a simple run to the whitewash. This time Van der Walt missed his kick, so it was 9-15.
There was some consolation at the end of the half for the Jaguares as Sánchez landed a penalty but their joy was short-lived when the game restarted after the break, with Volmink slipping through some ordinary tackles for his second. With the extras, the Lions led 22-12.
One area that was creating chances though for the Jaguares was the scrum it got them back into the match when Isa powered over.
They should have been just two points behind when Cyle Brink was offside tracking back on 54 minutes, but Sánchez was off-target from the tee. And when hooker Julian Montoya was stopped centimetres from the line soon after, it was beginning to look like being the Lions' day.
But the power of the scrum came to the fore moments later as Hoffmann had no choice to give a penalty try, with the Jaguares 24-22 up.
Sánchez extended that margin to five points and when replacement lock Mattias Alemanno scored from a close-range carry, suddenly the Lions were out of losing bonus-point range at 34-22 down in Buenos Aires.
And that was how the score remained until full-time as the Lions must now lick their wounds before unleashing their first-team against what will be a tough opponent in the Crusaders in Johannesburg next weekend.
Tries: Isa, Penalty, Alemanno
Con: Sánchez 2
Pen: Sánchez 5
Tries: Volmink 2, Mahuza
Con: Van der Walt 2
Pen: Van der Walt
Yellow card: Brink (54 min - offside), Erasmus (75 min - pulling down maul)
Jaguares: 15 Joaquín Tuculet, 14 Santiago Cordero, 13 Jerónimo de la Fuente, 12 Juan Martín Hernández, 11 Manuel Montero, 10 Nicolás Sánchez, 9 Martín Landajo, 8 Facundo Isa, 7 Juan Manuel Leguizamón, 6 Javier Ortega Desio, 5 Tomás Lavanini, 4 Guido Petti, 3 Ramiro Herrera, 2 Julian Montoya, 1 Nahuel Tetaz Chaparro
Replacements: 16 Facundo Bosch, 17 Santiago García Botta, 18 Enrique Pieretto, 19 Mattias Alemanno, 20 Marcos Kremer, 21 Gonzalo Bertranou, 22 Santiago Gonzalez Iglesias, 23 Mattias Orlando
Lions: 15 Sylvian Mahuza, 14 Koch Marx, 13 Stokkies Hanekom, 12 Howard Mnisi, 11 Anthony Volmink, 10 Jaco van der Walt, 9 Ross Cronjé (c), 8 Cyle Brink, 7 Robert Kruger, 6 Stef de Witt, 5 Lourens Erasmus, 4 Martin Muller, 3 Jacques van Rooyen, 2 Akker van der Merwe, 1 Corné Fourie
Replacements: 16 Ramone Samuels, 17 Clinton Theron, 18 Pieter Scholtz, 19 Fabian Booysen, 20 Ruaan Lerm, 21 Dillon Smit, 22 Jacques Nel, 23 Ashlon Davids
Referee: Rohan Hoffmann (Australia)
Assistant Referees: Angus Gardner (Australia), Federico Anselmi (Argentina)
TMO: Santiago Borsani (Argentina)