Gabriel Martinelli scored in the final moments in Houston to give Brazil a 2-1 win and knock out Hajime Moriyasu's side at the last 32 stage.
Paraguay and Singapore will also compete in the 'Mizuho Blue Challenge' from November 13th to 17th during the FIFA international window.
Singapore open the event, to be played at their national stadium, against Paraguay on November 13th, with the Japan-Brazil clash the following day.
The tournament ends with a double-header on November 17th, when Singapore take on five-time World Champions Brazil before Japan face Paraguay.
