China now trail the Qataris by four points with two matches remaining as the two countries effectively battle it out for the second qualifying position from Group One behind leaders Australia.
The match was decided in the 14th minute when a free kick was swung into the Chinese penalty area and striker Gao Lin was adjudged to have pulled back a Qatari defender.
The referee pointed to the spot and Qatar's Uruguayan-born striker Sebastian Quintana calmly sent goalkeeper Song Zhenyu the wrong way.
Manchester City's Sun Jihai was shown a red card despite not having made it off the substitutes' bench as Chinese frustrations at the officiating boiled over late in the game.
"We were not playing against 11 men but 12 or 13," China defender Li Weifeng told CCTV.
"I am really disappointed, we tried so hard. This might be my last chance to play at a World Cup," the 30-year-old added.