The Reds cut the margin to just three points with six minutes remaining in Friday night's match when youngster Treyvon Pritchard showed some flashy footwork in the corner to score his maiden Super Rugby Pacific try.
The whistle hadn't been on Queensland's side all match, and a late penalty for an incorrect entry into the breakdown proved to be the death knell.
The Chiefs (9-2) chose to take a scrum against a 14-man Reds outfit, and it paid dividends as Wallace Sititi barged over untouched in the 79th minute to seal the win.
The final penalty count read 12-5 against the Reds.
"There were some tough ones out there tonight for sure," Reds captain Fraser McReight told Stan.
"I felt there were definitely some calls that could have gone both ways.
"I thought we dug in really well. We came back from some really tough minutes there.
"It's a tough one to swallow."
The result dropped Queensland to fifth spot, leaving them a whopping 11 points adrift of third with just three rounds remaining.
Only the top three teams earn a home qualifying final, and the Reds will now have to do things the hard way if they are to take home the title.
Reds winger Lachie Anderson, in his comeback match from a dislocated wrist, made a hot start with an eighth-minute try.
Queensland's failure to deal with the restart cost them dearly as Chiefs flanker Sititi crossed to level the scores.
The Reds' lineout woes from last week continued, with Harry Wilson yelling out in frustration "what are we doing?" after Queensland lost their second line-out by the 20-minute mark.
It was three lineouts lost by the 29th minute.
Reds players were left furious when Chiefs fullback Isaac Hutchinson was initially awarded a 34th-minute try despite there appearing to be a series of knock-ons in the lead-up.
When it was finally checked by TMO Glenn Newman, three knock-ons were found, with the crowd laughing as each fumble was shown on the big screen.
There was more drama when the Reds were controversially denied a try after the halftime siren when the TMO deemed Seru Uru was held up over the line.
The quick decision seemed to have been made after watching just one unclear angle, but a different angle displayed just seconds later showed Uru had grounded it.
Reds players pointed to the big screen in an attempt to get the TMO to have another look, but their pleas fell on deaf ears.
Down 17-7 following a rolling maul try to Samisoni Taukei'aho, the Reds needed a spark, and a spark is what they got in the 65th minute.
A beautiful cut-out pass from fit-again flyhalf Carter Gordon released Wilson on the wing.
Wilson, with an opponent ready to lay a hit on him, dished off a no-look pass out the back of his hand to release a rampaging Joe Brial for a try.
Queensland's victory hopes were dealt a blow when Jeff Toomaga-Allen was yellow-carded in the 69th minute, with Taukei'aho scoring another rolling maul try just moments later, before the Reds landed one final blow through Pritchard.
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