The match was marked by tempers flaring and 11 yellow cards being shown, with seven going to Milan players and four to Sassuolo.
Milan is currently fourth in the standings with 38 points, just one point ahead of Lazio and Roma. Sassuolo, on the other hand, sits 16th. Despite the disappointment, Pioli stated that the team's goal is to secure a Champions League place this season.
The match saw several goals and key moments, with Olivier Giroud having a goal ruled offside by VAR in the eighth minute.
Sassuolo scored their first goal against the run of play, with Domenico Berardi sending a cross to an unmarked Gregoire Defrel to tap in. Davide Frattesi quickly doubled the lead, hammering in a low shot. Giroud pulled one back for Milan, but Berardi quickly restored Sassuolo's two-goal lead.
In the second half, Armand Lauriente converted a penalty and Matheus Henrique added the fifth goal for Sassuolo. Divock Origi scored Milan's second goal in the 81st minute with a well-placed strike from the edge of the box.
However, a set piece in the 54th minute that found Ante Rebic unmarked in the box was also ruled offside by VAR.
Pioli expressed his determination to overcome the negative situation and make the best decisions ahead of the Milan derby against Inter on February 5.
He acknowledged the team's recent struggles but stated that they must improve and deal with situations differently in order to secure a Champions League place this season.