David James has been one of the cornerstones of Portsmouth’s successes in recent seasons, but the goalkeeper will want to forget the defeat in Germany last night that brought a premature end to the club’s first European campaign.

With Braga beating Heerenveen in the other match in group E of the Uefa Cup, Portsmouth had to beat Wolfsburg to stay in the competition, but an almighty howler by the England No 1 gifted the winner to the talented Bundesliga side. It compounded an uncertain display by the entire Portsmouth defence and will revive memories of the big-game errors that have bedevilled James’s career.

After 74 minutes, with the ball at his feet and Zvjezdan Misimovic, the Bosnia midfield player, bearing down on him, James attempted to play a pass to Sylvain Distin, the Portsmouth central defender. Instead, he mis-hit the ball straight to the Wolfsburg player, who made short work of rounding the goalkeeper and rolling the ball into an empty net.

James partly made amends for his brainstorm by saving Misimovic’s under-hit penalty after Sol Campbell was judged to have fouled Edin Dzecko, but the damage was done. “It happens,” Tony Adams, the Portsmouth manager said. “He’s a fantastic goalkeeper. He saves penalties and he set up the first goal. I’ve every faith in him and I love him to bits. He’s been in the game a long time and there’s nothing I can say to him. He knows, and he’s not pleased.”

Adams’s team selection contained surprises, such as the omission from the starting line-up of Peter Crouch, although the attack functioned well. The problem was at the other end, as Adams admitted. “We made too many mistakes to win the game today,” he said. “Our defending was better in the second half, but in the first half we gave goals away. They are an excellent side and if you make mistakes, they pounce.”

Wolfsburg, eighth in the Bundesliga and unbeaten at the Volkswagen Arena since April, had scored 27 goals in nine home games before last night’s match and they were handed No 28 after only four minutes. Christian Gentner, the right-sided midfield player, was allowed to turn just inside the corner of the penalty area and curl a pass that swung dangerously towards the far post. The return of Campbell after injury was expected to improve a porous defence, but he and the rest of the back four stood immobile, perhaps waiting for James to leave his goalline and claim the ball, and the only man who moved was Dzeko, who volleyed home from four yards.

Many Portsmouth fans who got into the Volkswagen Arena late missed that goal, but soon they had two of their own to cheer. After ten minutes, James came to collect a corner from the left and instantly launched a prodigious throw that found Armand Traoré charging into the Wolfsburg half. Diego Benaglio, the goalkeeper, could only parry his cross-shot and Jermain Defoe reacted smartly to turn the ball across the goalline.

Improbably, in the fourteenth minute, Portsmouth were 2-1 ahead as Arnold Mvuemba shot from 25 yards and a deflection off Andrea Barzagli took the ball past Benaglio to give the French winger his second goal for the club in only his eighth start since arriving at Fratton Park in January 2007.

But if Portsmouth thought they were in the driving seat, they were mistaken, as their recent inability to hold a lead manifested itself again in the most farcical manner. Gentner, now on the left, hit a cross that was aimed at Dzecko, unmarked although only six yards out. He swung at the ball and missed it, but so did everyone else, including James, and the ball travelled unimpeded into the far corner of the net.

“We didn’t stop crosses and when they came in, the central defenders and midfield players could have done better,” Adams said. “We never got to grips with Gentner and Dzecko is a handful.”

James saved well from Misimovic before the interval and Niko Kranjcar’s free kick from 20 yards early in the second half was deflected on to the crossbar, but all the good work was undone by James’s error.

At the end, the home supporters celebrated a result that sends them through to the knockout phase as the Portsmouth fans waved farewell to Europe. Their fear must be that the enforced sale of players in January means that it will be some time before they are back.

Wolfsburg (4-2-3-1): D Benaglio — S Riether (sub: A Madlung, 46min), Ricardo Costa, A Barzagli, M Schäfer — Josué, C Zaccardo (sub: M Hasebe, 36) — C Gentner, Z Misimovic, A Dejagah (sub: J Simunek, 88) — E Dzeko. Substitutes not used: A Lenz, R Alvim, M Saglik, J Krzynowek.

Portsmouth (4-4-1-1): D James — G Johnson, S Campbell, S Distin, N Belhadj (sub: N Pamarot, 46) — A Mvuemba (sub: P Crouch, 64), S Davis, R Hughes, A Traoré — N Kranjcar (sub: Kanu, 76) — J Defoe. Substitutes not used: J Ashdown, H Hreidarsson, P Bouba Diop, G Little. Booked: Defoe, Pamarot.

Referee: I Bebek (Croatia).