Striker Maria Urrutia (14th minute) gave Chile a first-half lead before two quick-fire goals (84th and 85th minutes) towards the end of the match snuffed out any hopes of an Indian comeback.
India made three changes to their starting line-up from the match against Brazil with M Lintoingambi Devi replacing Aditi Chauhan between the sticks and Martina Thokchom and Manisa Panna coming in for Kamala Devi and Dangmei Grace.
The first chance of the match fell to the goal-scoring star of the game against Brazil, Manisha Kalyan, who met an in-swinging corner in the sixth minute but directed it straight to goalkeeper Endler.
Chile then took control of the game and created their first opportunity in the 12th minute. Maria Rojas sent in a low cross from the right for Javiera Toro who made an audacious back-heel attempt to score but was thwarted by Linthoi.
A minute later, Chile opened the scoring as Rojas, a constant thorn in India’s flesh during the first half, progressed down the right and found Urrutia, who scored with a first-time finish.
The rest of the half passed by without much incident as Linthoi and her defence kept the Chilean attack at bay with some good organisation.
After getting a measure of their Chilean opponents, India started the second half with a high press and looked much more dangerous on the break.
In the 66th minute, India broke forward on a counter-attack through Manisha and the 20-year-old found substitute Dangmei Grace, whose shot was saved by Endler.
A couple of minutes later, Chile were dispossessed on the halfway line and Manisha surged forward and drew another save from the 30-year-old Endler.
Just when India seemed to be growing in stature, Chile scored twice in the space of two minutes through substitute Isidora Hernandez and Karen Araya to seal the game in their favour.
India will play their final game against Venezuela on Thursday.