UK light-heavyweight Joshua Buatsi secured a victory yet disappointing start to his career under recent management with a unanimous decision over Parker in Manchester.
The Olympic bronze medallist's punch output likely gained him a split decision in a tight 10-round bout at the boxing arena.
But Parker landed significant shots, connecting with powerful single shots in a match where the styles didn't complement each other, with excessive holding disrupting the action.
The scoring judges had it 96-94 to the winner, with the third a 95-95 draw.
"It wasn't my greatest showing but how do champions respond? They win," Buatsi said in the ring as he was greeted with disapproval from the audience.
The British fighter returned to winning ways after his maiden career setback - an memorable fight with Callum Smith in February - to earn a 20th career victory.
Various analysts thought Parker, 31, deserved the decision but the contender suffered the second loss of his 28-bout professional journey.
The Champion Earns Victory in Uneventful Affair
His career development has plateaued in the past few years through promotional disputes and considerable time of inactivity.
Earlier forecast as the rising talent of British boxing, he now stands trying to fulfil that early promise - perhaps in what appears to be a ultimate opportunity - under recent support.
He began cautiously, with the two boxers ready to overcommit in a calculated initial rounds.
Parker, whose sole prior loss came at super-middleweight against his former opponent in 2022 after damaging his hand during the bout, was competing in only his second bout at light-heavyweight.
By the middle rounds, Parker had kept it close, making life awkward for Buatsi, who operated with a protective stance to narrowly win the cleaner periods.
The spectators' acceptance diminished amid frequent holding, with the challenger slipping to the canvas various instances during clinches.
The underdog ended stronger, but multiple periods were challenging to assess. However, ex-champion Carl Frampton - commentating on Dazn - had it particularly wide for Parker, scoring for Buatsi just a single round.
Buatsi progresses, but with the caliber of hard hitter Benavidez, and Russian champion Bivol dominating the weight class, the path to championship success - judging by this showing - still seems difficult.
Hatton Homage Inspires All-Manchester Battle
In the co-main event, Arthur defeated Bradley Rea by close verdict in a terrific Manchester vs Manchester fight to secure the European light heavyweight belt.
The venue became quiet for a profoundly moving memorial before the fight as 10 bells tolled in remembrance of local hero Hatton, who died aged 46 in September.
It was the premier televised boxing event in the city since the passing of Hatton. As the final chime faded, the stillness gave way to a chant of "there's just one Ricky Hatton".
The fighting within the ring reflected the feeling. Arthur was knocked down by a powerful punch directly to the chin in the second round, rising shakily to his feet on the count of eight.
But the traditional red attire of Arthur soon came forward again. On the opposite side, Rea - in opposing blue - was marked up quickly, noticeable damage forming under his eye as the duo traded hard punches.
The challenger, twenty-seven, landed power punches but Arthur, 34, fought fire with fire with stinging uppercuts as the action hardly diminished over the full distance.
The victor edged the verdict with judges scorecards of draw, 115-113 and wider gap, but both fighters were determined and full of heart, everything their hero the legend represented.
