Nelson was KOd by Argentina’s Santiago Ponzinibbio in the co-main events at UFC Fight Night 113 at the SSE Arena.
The Renzo Gracie black belt went into the contest as the overwhelming favourite following an impressive showing against Alan Jouban at UFC Fight Night 107.
However, it was Ponzinibbio who ended up coming out of the contest victorious, defeating the No.8 ranked welterweight via first-round KO.
Defeat to Ponzinibbio ended a two-fight winning streak for Nelson, who claimed to have suffered an eye poke moments before being stopped.
And he regrets not saying something which could have prevented the surprise knockout.
“I thought I was doing really well in the beginning,” Nelson said.
“In the first exchange, I caught him with an uppercut and he poked me in the eye and I really should have said something because I was seeing double for the rest of the fight.
“He caught me with a shot that I didn’t really see. The eye is still sore now but it’s just one of those things, I really should have said something and I don’t know why I didn’t.
“Maybe I would have seen that shot that caught me but it is what it is, you know.”