The 26-year-old missed a match defining penalty after attempting a cheeky chip [the paneka] that was easily gathered by Al Ahli goalkeeper Edouard Mendy in extra-time before Senegal scored the winner.
"I failed and I take full responsibility and apologise wholeheartedly," read a statement on his social media account.
"It will be difficult for me to recover because this wound does not heal easily, but I will try.
"Not for myself, but for all those who believed in me and for all those who suffered with me. I will keep going until one day I can give you all this love back and be the pride of the Moroccan people."
The diminutive attacker ended the 2025 AFCON tournament as the top goal scorer with five goals in seven matches to earn the Golden Boot in his first tournament.
He will be hopeful for a chance to redeem himself at the 2026 FIFA World Cup in North America later this year.
Diaz is expected to return to a reported 'special welcome' at Real Madrid on Wednesday, with the club throwing its support to the winger who has made 18 appearances for the Spanish giants this season, scoring once and providing two assists.