Following a goalless first half, Upamecano was at the centre of drama that unfolded midway through the second period as he was shown a straight red card for a stood-showing challenge on the ankle of Gustav Isaksen inside the penalty area.
Ciro Immobile converted the resulting spot kick and Bayern were unable to respond, falling to a slender defeat after failing to register any of their 17 shots on target at Stadio Olimpico.
Shortly after the full-time whistle blew, Bayern addressed the racist abuse Upamecano received on social media following the defender's dismissal.
A statement on 'X' read: "FC Bayern strongly condemn the racist comments being directed towards Dayot Upamecano on social media. Anyone who comments hateful words such as these is no fan of our club. We're all behind you, Upa!"
This is the second time that Bayern have had to release a statement condemning racist abuse towards Upamecano, who was also targeted online after a Champions League defeat at Manchester City in April last year.
Kingsley Coman and Mathys Tel are two other Bayern players who have also been the subjects of racist abuse over the last 12 months.
Upamecano joined Bayern in the summer of 2021 and has since established himself as a first-team regular at the Allianz Arena, making 105 appearances across all competitions.
Despite suffering with a few niggling injuries, the 25-year-old has managed to play 24 times for Thomas Tuchel's side this season, including six starts in the Champions League.
Upamecano, who will miss the last-16 second-leg clash with Lazio in three weeks' time, has been part of a Bayern side that have lost their last two games in the space of just five days and are at risk of ending the 2023-24 campaign without a trophy.
The Bavarians are tasked with overturning a one-goal deficit to beat Lazio if they wish to progress to the Champions League quarter-finals, while they find themselves five points behind Bundesliga leaders Bayer Leverkusen following last weekend's 3-0 defeat to Xabi Alonso's side.
Bayern were also eliminated in the DFB-Pokal to third-tier outfit Saarbrucken earlier this season, and the pressure is mounting on head coach Tuchel, who has insisted that he is not fearing the sack.
"I'm not worried about my future or potential sack," Tuchel said at his post-match press conference. "We did everything to lose this match... it was in our hands. At a certain point we stopped believing, I've no idea why. There were many individual mistakes".
Bayern will seek to return to winning ways and boost their hopes of retaining the Bundesliga title when they travel to VfL Bochum on Sunday.