It trails leader Barcelona by 14 points and languishes 7 points behind second-placed city rival Atletico, which was handicapped by a transfer ban last summer.
Cristiano Ronaldo was rested with the Champions League second leg against Paris Saint-Germain in mind.
However, despite a promising start, an insipid Madrid were second-best all night at Cornella not that Zidane thought so.
It was Real's first defeat by the Catalans in 11 years after the latest in a long line of insipid displays without Ronaldo that highlight how important the evergreen 33-year-old - who has scored 12 goals in his last seven appearances - is to the side. "The second half was worse, but we didn't deserve a last-minute defeat".
"If we had scored in the first half when playing well, it would have been different". He didn't get a chance to show it against Espanyol.
"He knows this very well and we talk, as always, a great deal".
Espanyol's winning goal came when club captain Sergio Ramos left his defensive post to join the attack for the closing stages of the game, something which Zidane said should not be criticised.
Espanyol should have led only for Moreno to spurn a gilt-edged chance after pouncing on a wayward Varane clearance.
Gerard was the protagonist in both, the forward first failing to capitalise on a skewed Raphael Varane clearance and then doing brilliantly to control a thundering half-volley from Carlos Sanchez, only to see his finish ruled out for offside.
The shot beat Madrid keeper Keylor Navas as he dove to his left.
Zidane admitted that his side did not do enough to win the game but went on to say that a draw would have been a fair result.
"We have missed a bit of everything". We should be doing this more regularly and it'll give us the confidence that we needed.