A stoppage-time equaliser by striker Vesna Smiljkovic denied England victory in their first Euro 2013 qualifier.
Hope Powell's team led 2-0 at half-time through a strike by left winger Rachel Yankey and Serbian defender Violeta Slovic's own goal in the 19th minute.
But midfielder Danka Podovac cut the lead in the 55th minute and, with England wilting in the intense Belgrade heat, Serbia scored a shock equaliser.
"We had enough opportunities to kill the game off," said coach Powell.
She added: "The conditions were extremely challenging, but that's no excuse."
Temperatures in the Omladinski Stadium topped 30C, but England were nevertheless expected to beat a team who sit 39 places below them in the world rankings and are one of the minnows of the five-nation qualifying group.
Victory for Powell's sixth-ranked side seemed a formality after Yankey had driven home a low shot from a tight angle and Slovic deflected the ball into her own net after a Sophie Bradley header had been blocked on the line.
But misses by strikers Natasha Dowie and Ellen White either side of half-time proved costly as England began to lose their grip on the game.
Podovac reduced the arrears direct from a 25-yard free-kick, expertly curled just inside the near post.
And as the home side sensed that they could force a draw, striker Mirela Tenkov had a goal-bound 67th-minute cross-shot well saved by goalkeeper Rachel Brown.
England became increasingly nervous in the closing stages and were finally undone four minutes into stoppage time, when Smiljkovic drilled in a powerful 18-yard shot.
It was a bitterly disappointing end to Powell's 140th game in charge, taking her past Sir Walter Winterbottom's record for England games managed.
She had made five changes - two of them forced - to the team that lost on penalties to France in their last match, the World Cup quarter-final in Germany.
But she insisted: "That team was good enough to win this game. Sloppy play cost us - we were our own worst enemies."
Serbia (4-1-2-3): Vukavic; Ilic (Trajkovic 83), Slovic, Stojkanovic, Damnjanovic; Pesic; Nesic, Podovac; Smiljkovic, Tenkov (Karadzic 78), Sretenovic (Radojicic 39).
Substitutes not used: Gardijan, Nikolic, Jovanovic, Kristic.
England (4-2-3-1): Brown (Everton); Susi (Birmingham City), Bradley (Lincoln), Stoney (Lincoln), Unitt (Everton); J. Scott (Everton), Bassett (Birmingham City); White (Arsenal), Carney (Birmingham City), Yankey (Arsenal); Dowie (Everton) (R. Williams (Birmingham City) 46).
Substitutes not used: Chamberlain (Bristol Academy), Whelan (Everton), Houghton (Arsenal), F. Williams (Everton), A. Scott (Boston Breakers), Buet (Chelsea).
Referee: Sandra Braz Bastos (Portugal)