Taiwo Awoniyi headed Forest in front inside two minutes from Bilal Dakwa's cross. Igor Jesus converted a penalty after 15 minutes following a foul from Malo Gusto on Awoniyi.
Chelsea had opportunities to change the course of the game — Enzo Fernandez struck the post and Cole Palmer missed a penalty — before Joao Pedro scored a brilliant late overhead kick consolation after an offside goal had already been disallowed. Nottingham Forest ran out comfortable 3-1 winners, moving into the top four, while Chelsea dropped to ninth.
McFarlane was forthright in his assessment.
"A really disappointing result and performance. The first 15 minutes was not good enough. That set the tone. It's hard to say why it went wrong at the moment — I'd probably like to review the game to look at such a stark contrast to the way we defended against Leeds."
He pointed to the moments that could have changed the game's direction.
"Enzo Fernandez hits the post and Cole Palmer misses the penalty. When you have such a bad start you need those kinds of moments to go in your favour and unfortunately they didn't."
Asked whether the squad was difficult to manage given the results, McFarlane was firm in rejecting that framing.
"I wouldn't say that. I don't think we lacked effort and commitment. We got into some good situations in the second half — it wasn't down to a lack of effort."
He insisted the group retains belief despite the run.
"We believe we will stop the rot — we see the lads every day and they are doing everything they can. We need to move on quickly and it's about responding now."
Chelsea's run of six consecutive league defeats is their worst sequence in the Premier League era. With three games remaining they sit ninth, seven points behind sixth-placed Bournemouth. McFarlane confirmed after the game that the two head injury incidents — involving Jesse Derry and Forest's Zach Abbott in the first half — were both being assessed, with Derry having made his debut in the match.
Chelsea host Everton on Saturday.