The Walleye needed just one point tonight to qualify for the ECHL playoffs but Toledo lost 3-1 to Reading.
The Walleye could have clinched a spot with a win or tie against the Royals. But Reading scored two goals in the second period to break open a scoreless deadlock.
Toledo (35-25-9) was held to its fewest shots in a game this season as the Walleye managed just 16 shots on goal before a sellout crowd of 8,000 at the Huntington Center.
Willie Coetzee got Toledo on the board with 4:39 left. Coetzee scored his team-leading 28 goal of season.
Walleye goalie Kent Simpson made his sixth consecutive start and was strong early in the game to keep it scoreless. He finished with 20 saves.
The first-place Royals (45-18-6) maintained their lead in the Eastern Conference with 96 points.
Reading got two goals from Nikita Kashirsky and another from captain Yannick Tifu in the second period.
Toledo matched a season-low for shots in a period with two shots in the first period. The Walleye then had just five in the second.
The teams meet again 5:05 p.m. Sunday at the Huntington Center.
The Walleye also could have qualified if Kalamazoo lost on Saturday. But the K-Wings lead Evansville in the second period.