Two goals from Luis Suarez have condemned England to a 2-1 defeat to leave their World Cup hopes hanging by a thread.
Wayne Rooney levelled the contest for Roy Hodgson's side 15 minutes from time, but Suarez added to his first-half opener with five minutes remaining to secure the points in Sao Paulo.
The lively striker came close to opening the scoring early on when he whipped a corner goalwards which almost caught out Joe Hart, only for the England keeper to push the ball away at his front post.
Shortly after, Rooney produced a fine curling effort which looked destined for the top corner, but the ball ended up narrowly wide of the target to the relief of Fernando Muslera.
The first big chance of the contest fell to Cristian Rodriguez when he was picked out in acres of space, but he failed to test Hart with his powerful drive which missed the target.
England created openings of their own, however, and Rooney came within inches of breaking the deadlock when his headed effort from Steven Gerrard's cross came back off the post.
As the game looked to be edging towards a goalless first half, Suarez arrived at the back post to head home Edison Cavani's inch-perfect cross to fire Uruguay ahead.
A slow start to the second half for Hodgson's side allowed Uruguay to come close to extending their lead on a couple of occasions. First, Suarez once more almost got the better of Hart from a corner which beat Danny Welbeck at the front post, while Cavani failed to convert when played through one on one with the England stopper.
Rooney could have made Cavani pay for his missed opportunity when picked out by Leighton Baines in the box, though Muslera was equal to the striker's drilled shot.
England did find a breakthrough goal on the 75-minute mark, however, and it was Rooney who found the net with his first World Cup goal - converting Glenn Johnson's low ball inside the box to make it 1-1.
Following the goal England pushed on and came close to taking the lead through Daniel Sturridge, who turned two defenders in the box before getting a shot away which was kept out by Muslera once more.
With five minutes remaining Suarez added his second of the game to fire the South Americans back ahead, latching on to Gerrard's flicked header towards his own goal, before taking a touch and placing the ball beyond Hart.
England now find themselves bottom of Group D and needing results to go their way in the final round of fixtures next week.