Wales suffered a late collapse after goals from Rouzbeh Cheshmi and Ramin Rezaeian earned Iran a 2-0 win.
Both goals came in the 98th and 101st minutes of the match after Wayne Hennessey was sent off in the 86th minute for a serious foul, leading to a frantic end to the World Cup clash in Qatar.
As a result, Rob Page’s side will need a win against England to have any chance of progressing to the next round.
After scoring a point against the United States earlier this week, Wales were hoping for maximum comebacks against Iran but instead looked second best against the impressive side of Carlos Queiroz.
Iran nearly opened the scoring after just 15 minutes when Connor Roberts’ cross pass was intercepted, giving Ali Gholizadeh a chance to convert from close range.
Luckily for Wales, that goal was correctly ruled out by VAR for offside, much to the Burnley full-back’s relief.
In a fairly even match, there was little to choose between the two nations, but an anxious 10-second stretch in the second half indicated the odds were firmly on the Welsh side after Iran struck the pole twice in a row.
With Aaron Ramsey giving the ball away at the edge of the box, Sardar Azmoun smashed the ball over a post, before the ball fell to Ehsan Hajsafi who rolled up an effort that bounced off the other post before falling into arms by Wayne Hennessey, leading Dean Saunders to tell talkSPORT: ‘We got away with one there!’
With Iran dominated, Brennan Johnson and Dan James were brought in to provide a different threat for Page’s side, leading to an incredibly open final half hour.
Hennessey was then forced into another smart save to deny Saeed Ezatolahi, with Iran knocking firmly on the door for a winner, with talkSPORT commentator Nigel Adderley saying ‘Wales are hanging on grimly for a point’ and saying that if Wales were to win it would be ‘daylight flight’.
However, things quickly deteriorated with Hennessey sent off for serious foul play after charging out of his area, leading to a late Iran charge as Cheshmi and Resaeian scored in the 98e and 101st minute to secure a late win.
Wales now have everything to do for the final game of Group B, knowing that defeat here is a potentially fatal blow to their hopes of progress.