The Gunners produced a worryingly lethargic display as Bournemouth left north London with all three points to hand Manchester City the chance to reduce the gap at the top to six when they face Chelsea at Stamford Bridge on Sunday.
It was a third consecutive domestic defeat for Arteta's side - following their Carabao Cup final loss against City and FA Cup exit to Southampton - and it places major doubt over whether they will secure their first title in 22 years, having finished runner-up for the past three seasons.
"It's extremely disappointing," Arteta said. "It's a big punch in the face, but it's about how we react now.
"That's what I said to the boys.
"There are no grey areas. Today there were some very basic things that we did extremely badly. When you do that, they're going to capitalise, and it becomes very chaotic and very difficult to control.
"We have to look at ourselves. We have to suffer. It's painful. It's a terrible feeling. But tomorrow is a different day. And if somebody would have said to me in August, we are in this position right now in April, I'm sure we would all have taken it."
Arsenal have finished runners-up for the past three seasons, and their latest defeat not only hands the championship momentum to City, but again raises serious questions about their title-winning mentality.
The two rivals meet at the Etihad Stadium next Sunday, and should Pep Guardiola's side triumph in that match, see off Chelsea on Sunday, and also beat Burnley on April 22 they would be level on points with the Gunners with five games remaining.
But Arteta, who was without Bukayo Saka, Jurrien Timber, Martin Odegaard and Riccardo Calafiori through injury on Saturday, said: "We can't control that. What we can control is our performances over the last nine months.
"Anything that is said when you have a defeat at home, you have to accept that. There are no excuses. It's about how we're going to stand up, first of all, individually, and then as a team to change that immediately on Wednesday (against Sporting in the second leg).
"So, we need everything. We need everybody fit and available. The ones that were not involved today are really big, important players, and we need them immediately with us because then we're going to be much stronger.
"And then the other ones, they need to stand up. Me, being the first one, and embrace this challenge and go for it."
"Mikel Arteta called on the Arsenal fans to be ready for the lunchtime kick-off against Bournemouth.
"There have been times this season where they have been edgy and nervous, but that cannot be labelled at them now. They were ready but unfortunately for them, the players were not.
"They lacked tempo, intensity, rhythm and so much more against a superb Bournemouth team.
"Three or four times in the first half Ben White took an age to take a throw-in, with the fans urging him to get the ball moving quicker. The ball kept going back to David Raya as Arsenal were ponderous in possession as they racked up an open play xG of just 0.19.
"It's not new for Arsenal in recent weeks. It was similar in the Carabao Cup final against Man City and also against Southampton as the Gunners exited the FA Cup. Without a threat going forward, the Gunners hold no fear for the opposition.
"There was talk this week of talks over a new deal for Arteta. He's now got to show he's worth it, finding a way to get Arsenal's mis-firing attack going again. Otherwise, they will blow yet another chance of securing a first Premier League title in 22 years."
