Despite the loss, Guardiola hailed Ederson as City's best player on the night, crediting him for making multiple saves that kept Real Madrid at bay.
The match saw an eventful exchange of goals. Erling Haaland opened the scoring, and Kylian Mbappe equalised for Real Madrid with an unconventional shinned effort that looped into the net. However, City quickly responded, regaining the lead through a Haaland penalty.
Madrid's equaliser stemmed from a long ball played by Ederson, which was swiftly returned, leaving him to parry it into the path of Brahim Diaz, who capitalised on the opportunity.
The winning goal came from a mistake in City's defence when Mateo Kovacic's misplaced pass was intercepted by Vinicius Jr. The Brazilian dribbled past Rico Lewis and set up Jude Bellingham for a simple tap-in.
Guardiola admitted that City made too many errors on the night but maintained his support for Ederson. He defended the goalkeeper's decision before Madrid's second goal, arguing that a different action could have led to the same outcome.
Despite the disappointment, Guardiola's faith in Ederson remained unwavering, as he praised the Brazilian's overall performance and shot-stopping efforts.
"Eddy decided to play a long ball, it was not a good kick and they scored," said Guardiola. "Maybe we played short and they scored and you say play long.
"Players take a decision in the moment - sometimes it works, sometimes it doesn't but it's not today, it has happened many times. Reflect and think and maybe in the future it will not happen and be brave for the next games.
"The previous games, the way we played we had to win for a big margin and it didn't happen. Today was tighter. Madrid had chances and played good with the ball when in the past it didn't happen.
"In the moments that we should have the situation we could not manage it but we arrived in the last minuets with a good result and we could not keep it."
Jurgen Klopp has revealed the extraordinary lengths Liverpool went to in their failed attempt to sign Kylian Mbappe from Monaco in 2017, describing the pursuit as the club's "most expensive non-transfer."
Fulham have confirmed the appointment of 43-year-old Alvaro Arbeloa as their new head coach, with the former Real Madrid boss committing to a three-year deal at Craven Cottage.
Real Madrid are laying the groundwork for life after Thibaut Courtois, but any change between the posts remains firmly a long-term project rather than an immediate objective.
Dayot Upamecano has delivered a strong message over Michael Olise's future, insisting the Bayern Munich winger will remain at the club despite continued speculation linking him with a move to Real Madrid.
