The Tall Blacks were beaten 88-81 by World No 10 Italy in the FIBA Solidarity Cup in China.
In the final tune-up for both teams before heading to the World Cup in Manila, the New Zealanders led for much of the game and looked in strong form - before Italy stormed back in the fourth quarter to seal their seventh win in a row.
The Tall Blacks were led by Finn Delany's 13 points, 6 rebounds and 6 assists.
Izayah Le'afa and Reuben Te Rangi scored 13 points apiece while Flynn Cameron added 11 and Tohi Smith-Milner eight.
Although the Tall Blacks out rebounded Italy 35-33 and shot an impressive 15/35 from outside the arc, they committed 19 turnovers for the game along with 26 fouls.
Italy had four players in double figures, led by Matteo Spagnolo's 14 points. Giampaolo Ricci and Stefano Tonut each scored 12 and Achille Polonara 10. The team showed a crisp offence in racking up 26 assists on its 30 made goals, while scoring a health 30/62 (48%) from the field.
The Tall Blacks took a 23-22 lead after the first period, with Italy keeping pace in the second to tie it up at 43 apiece at halftime.
New Zealand managed to build a three point lead in the third period, setting the stage for an exciting final quarter.
It would be Italy who caught fire in the fourth, building a seven point margin before New Zealand fought back with a Cameron triple reclaiming a 77-76 lead with just over four minutes left.
But New Zealand would go cold following this basket as Italy embarked on a 10-0 run - giving them a 9 point lead with a minute left.
A basket by Delany and a steal and dunk by Cameron reduced the deficit to five, but the Tall Blacks wouldn't score again and Italy walked away with their seventh straight victory.
The Tall Blacks now head to Manila for the Basketball World Cup, where they will face USA, Jordan and Greece in the first round.
Stats:
New Zealand 81 - Delany 13 PTS & 6 REB & 6 AST | Le'afa 13 PTS | Te Rangi 13 PTS | Cameron 11 PTS | Smith-Milner 8 PTS | Brown 6 PTS | I. Fotu 5 PTS & 5 REB | Ili 4 PTS | Wetzell 4 PTS | Britt 2 PTS | Ngatai 2 PTS | Harris 2 PTS
Italy 88 - Spagnolo 14 PTS | Ricci 12 PTS | Tonut 12 PTS | Polonara 10 PTS
-RNZ