Arsene Wenger has admitted seeing victory snatched away tonight by Antoine Griezmann late goal for Atletico was a kick in the teeth.
In the 82nd minute Griezmann escaped the attentions of Laurent Koscielny following a long, hopeful ball over the top and, although Ospina blocked the forward's first effort, he swept home the rebound as Shkodran Mustafi slipped.
Before Lacazette's opener, Madrid were holding out for a goalless draw to take back to the Spanish capital for next Thursday's second-leg as Sime Vrsaljko was sent off early on, followed swiftly by manager Diego Simeone.
This was Wenger's final home European tie in charge after he announced last week he will step down in the summer after over 21 years in charge but it ended in now familiar disappointment.
"I think looking at the performance and the way the game went it was the worst possible result for us," the Arsenal boss said on BT Sport.
"We have to go there in a positive mood and qualify over there.
"Unfortunately we gave a goal away from nowhere."
Wenger agreed the first leg felt like an opportunity missed.
"Once we score the 1-0, even if we did not score again it was important not to concede," he said.
Asked how confident he was that Arsenal would still progress to the final in Lyon, he added: "How doesn't matter. What matters is we go there with absolute belief to do it."
Danny Welbeck admitted Arsenal were frustrated at conceding a late away goal.
He said on BT Sport: "It's disappointing to take the lead and then to concede a goal right near the end. We are disappointed with that.
"We've got to try and make sure that doesn't happen again."
The hosts had a succession of chances early in the game, but were unable to make them count.
"There were opportunities there for us to score, (we're) disappointed with that," said Welbeck. "It gives us a little bit of positivity going into the second leg, knowing we can create chances against a great side.
"We know we can score against them, we did it tonight. We're positive going into that game."
Asked if the chance to win a first European trophy for Wenger in his final season was an added motivation for the players, Welbeck said on BT Sport: "Seeing him at the end lift the trophy would be the icing on the cake, but we don't need that extra incentive."
On the result, Lacazette said: "We wanted to win tonight, but we need a great result next week."