Japan's Ayase Ueda scored twice for Hajime Moriyasu's side, who finished second with six points, while Iraq's Aymen Hussein went top of the tournament's scoring charts with his fourth and fifth goals.
"After losing to Iraq we looked back to see what we need to improve and fix. My players were focused and able to perform at 100%," Moriyasu told reporters.
"I asked my players to be more aggressive from the start. The early penalty allowed us to control the game for 90 minutes."
Japan took a 1-0 lead when they won a penalty in the second minute after Ueda was hauled down in the box by Jordi Amat, with the spot kick awarded after a VAR check.
Ueda stepped up to take it himself and after composing himself he fired home into the top corner in front of the Indonesian fans behind the goal.
"I had to score and the pressure was on me after the result from the last game. I get nervous but I also enjoy taking them," he said.
They nearly made it 2-0 just after the half-hour mark when Keito Nakamura's first-time effort came off the inside of the post and rolled dangerously close to the goal line before it was cleared.
But Japan eventually doubled their lead when Ritsu Doan put in a pass across the six-yard box that beat every defender and found Ueda unmarked at the far post for an easy tap-in.
The goal put a spring in Japan's step and they continued to push Indonesia back, with the Southeast Asian team unable to prevent a third when Ueda forced an own goal in the 88th minute after Justin Hubner attempted to block his shot.
Indonesia scored a consolation goal in stoppage time when Japan failed to clear a long throw-in and the ball fell to Sandy Walsh at the far post where he finished smartly for his first international goal.
"We conceded in the last minutes from a long throw. We need to focus on keeping a clean sheet in the next game," added Moriyasu, whose side have conceded in all three group games.
With only three points, Indonesia will now have to wait until Thursday to see if they can qualify as one of the four best third-placed teams.
"Anything can happen, I can't say anything about what could happen tomorrow. We'll rest and wait for the results of the next games," Indonesia coach Shin Tae-yong said.
IRAQ LEAVE IT LATE
In the other Group D game, Vietnam took the lead just before halftime when Bui Hoang Viet Anh scored from a set piece but Khuat Van Khang was sent off for a second yellow on the stroke of half time.
Iraq equalised two minutes after the restart when Rebin Sulaka headed home from a corner before Hussein scored with a header of his own in the 73rd minute.
Vietnam nearly stole a point when Nguyen Quang Hai equalised in the 91st minute but Iraq earned a penalty which was calmly converted by Huessein in the 12th minute of stoppage time.
