Australia coach Tony Gustavsson was facing questions on Friday after a stunning 3-2 defeat to Nigeria left the Women's World Cup co-hosts "teetering on the edge of something deep and dark".

 The Matildas could have sealed their place in the last 16 with victory in front of a sell-out Brisbane crowd on Thursday and took the lead in first-half injury time through Emily van Egmond.

But Nigeria struck back on the stroke of half-time through Uchenna Kanu and scored twice more in the second half, before Gustavsson's side pulled a goal back deep into injury time at the end of the match.

The defeat left Australia needing to beat Olympic champions Canada on Monday to stay in the competition.

The Swede Gustavsson was under pressure afterwards to explain why he left it until the 82nd minute to make his first substitution -- they were losing 3-1 by then.

And when he did make his first change, he took off an attacker and brought on a defender in Clare Polkinghorne, and pushed defender Alanna Kennedy up front.

That exposed Australia's lack of goalscoring options with Sam Kerr injured, and Kennedy did score very late on, but Gustavsson's tactics were nevertheless in the spotlight.

Former men's international goalkeeper Mark Schwarzer told Optus Sport: "I think when he looks back at those substitutions, when he made them and the type of substitutions he made, I think he'll look back with a little bit of regret."

Former Matilda Amy Chapman agreed: "He needed to go for it. There's a 3-1 gap there. It's too late."

Schwarzer put the question to Gustavsson, who replied: "As a coach you always evaluate after the game, do you do it in the right moment, when do you do those subs?

"I'm going to look back at it and see if it was the right moment."

Australia had plenty of the ball, especially in the first half, but Nigeria were more clinical.

Local media said Gustavsson should have done better with his substitutions, but also felt the Matildas had enough chances to win the game -- 27 attempts at goal to Nigeria's 11.

"After coming into this tournament riding a wave of positivity — especially compared to the other teams in their group — the Matildas are teetering on the edge of something deep and dark and vastly cold," said Australian broadcaster ABC.