Belgium, who levelled just before half-time when Tessa Wullaert got in behind Carter and Millie Bright and slotted a low finish past Mary Earps, struck the winner five minutes from time when Wullaert tucked a penalty into the corner after Georgia Stanway had been penalised for a handball in the area.
The defeat leaves England third in the group and now needing other results to go their way in December for them to have any chance of reaching the Nations League semi-finals and final in February, with only the two best-performing sides joining hosts France at the Olympics next summer.
Belgium (5-4-1) Evrard; Cayman, Kees, De Caigny, De Neve (Wijnants 41), Deloose; Blom (Delacauw 74), Vanhaevermaet, Missipo, Detruyer (Daniels 74); Wullaert (Janssens 89).
Subs Lemey (g), Lichtfus (g), Philtjens, Van Belle, Littel, Iliano, Vangheluwe, Fon. Booked Detruyer, Missipo, Janssens.
England (4-3-3) Earps; Bronze, Bright, Greenwood (Carter 32), Charles; Stanway, Walsh, Kirby (Toone 68); Hemp, Russo (Daly 68), Kelly.
Subs Hampton (g), Roebuck (g), Keating (g), Morgan, Zelem, Wubben-Moy, Clinton, Le Tissier, Park.
Referee Esther Staubli (Switzerland). Attendance 7,235.