“The Czechs were better. We were off to a flying start but then we started losing pucks in the wrong situations,” said Swedish player Henrik Zetterberg to news agency TT after the defeat.
Dallas Stars left winger Loui Eriksson put Sweden ahead at 7:10 but the Czechs replied positively for a 2-1 lead before the first break as their forwards Petr Nedved and Jiri Novotny scored one apiece.
Nashville Predators right wing Martin Erat increased the Czech lead at 30:27 on powerplay but Detroit Red Wings left winger Zetterberg and Jonathan Eriksson scored 45 seconds before and after the second break to pull the scores level.
Ottawa Senators winger Milan Michalek had the few Czech supporters in the Stockholm Globen arena on their feet with just 29 seconds remaining when he placed the winning goal straight into the net behind Swedish goalminder Viktor Fasth.
“It feels bloody harsh right now," said Fasth to TT coming off the ice.
The defeat so early on in the competition has started speculation into whether Swedish head coach Pär Mårts will hand in his resignation.
In Saturday's semi-finals Finland will face Russia in a replay of the last year's semi-final, while the Czech Republic will take on former compatriots Slovakia, which dispatched Canada in a 4-3 upset win.