Rangers' hopes of making a Champions League return were dented after the Glasgow giants slumped to a 2-0 away defeat at Belgian minnow Union Saint-Gilloise in the first leg of their third qualifying round tie Tuesday.
French-born Maltese international Teddy Teuma gave the Belgians the lead just before the half-hour mark, and Union Saint-Gilloise got a potentially crucial second goal in controversial fashion with 14 minutes left.
Connor Goldson was penalized for a handball in the area following a video assistant referee (VAR) review and Dante Vanzeir stepped up to score the resulting penalty.
It is a remarkable result for the Brussels club, who returned to the Belgian top flight last season after an absence of almost half a century and promptly finished second under the ownership of English entrepreneur Tony Bloom.
Unable to host Rangers in their own stadium, the match was played in the nearby city of Leuven, but that did not prove a handicap for Union.
Giovanni van Bronckhorst's Rangers now face an uphill struggle in the return leg next Tuesday, Aug. 9.
"It is very disappointing, especially when our performance was not at the level we normally are and the level you need to compete at this level," Van Bronckhorst told the BBC.
Of the penalty, he added: "You are playing in the biggest competition in Europe, with so much at stake, and to give a penalty like this is very hard."
Last season's beaten Europa League finalists, Rangers are looking to return to the Champions League group stage for the first time in over a decade.
The winners of the third qualifying round tie will go on to a play-off later this month against either Monaco or PSV Eindhoven, with the winners of that advancing to the group stage.
Monaco needed a late equalizer from center back Axel Disasi to draw 1-1 with Ruud van Nistelrooy's PSV at the Stade Louis II on Tuesday.
Disasi prodded home from close range when an Ismail Jakobs free-kick fell to him in the penalty area 10 minutes from time.
That canceled out Joey Veerman's first-half opener for PSV and ensured the tie is finely poised ahead of next week's return leg in the Netherlands.
Monaco missed out on direct qualification for the group stage when they conceded a stoppage-time goal on the final day of the last Ligue 1 season and dropped from second to third in the table as a result, behind Marseille.
Benfica, who reached the quarterfinals last season before losing to Liverpool, crushed Midtjylland of Denmark 4-1 in Lisbon with Goncalo Ramos scoring a hat trick.
Enzo Fernandez also scored for the Portuguese side with Pione Sisto netting a late consolation from the penalty spot.
Earlier there were 2-1 away wins for Viktoria Plzen of the Czech Republic, and Croatia's Dinamo Zagreb, against Sheriff Tiraspol of Moldova and Ludogorets of Bulgaria respectively.
Dynamo Kyiv is in action on Wednesday but the Ukrainian club will play the home leg of its tie against Austria's Sturm Graz in the Polish city of Lodz due to the ongoing conflict in the country.
