Flynn's youngsters narrowly missed out on this year's Championships
Wales Under-21s' seven-match unbeaten run was ended by Bosnia-Hercegovina who came from behind to secure their first Euro 2011 qualifying win in Sarajevo.
Joe Allen put Wales ahead after five minutes, tapping home Simon Church's flick from close range.
Bosnia levelled 25 minutes later through Anes Haurdic, who pounced when Wales failed to clear their lines.
Chris Maxwell saved a second-half penalty from Nenad Kiso, but Haurdic grabbed a 66th-minute winner.
It was the first defeat of the campaign for Brian Flynn's side who are still top of Group Three with 13 points.
Hungary are in second place, four points behind with two games in hand.
Wales had won four of their five group games with the only points being dropped in the 0-0 draw in Luxembourg.
But they now go into their 10-month break with a defeat and finish their qualifying campaign with important trips to Hungary and Italy next September.
The 10 group winners and four best runners-up will qualify for the play-off stage, with the seven winners joining hosts Denmark in the finals in June 2011.
Wales midfielder Joe Joe Allen: "There's obviously disappointment around the camp, but we got what we deserved.
"We're still top of the table and deserve to be there. We've got two games to get the win we're after.
"We've suffered disappointment in the past and bounced back very strongly, with this group of players I'm sure it will be the same again.
"Everyone knows I don't get goals that often so it would have been nice if the goal had been an important one - I would have traded it for three points and a win.
"Maybe I can score a more meaningful goal in one of the next two games. We've got to go into those matches and put it right."
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