The loss on Tyneside leaves them needing a miracle to claim a spot in the top four over Tottenham Hotspur on the final day.
Arteta pulled no punches in his post-match press conference.
"It’s a really tough night," he said.
"Normally, I can sit here and I can defend, but what we’ve done today, it’s not easy.
"Newcastle were one hundred times better than us in every department from the beginning to the end and it’s hard to accept to accept, but you have to accept it and that’s the reality of what happened today on that pitch."
Second best throughout
Arsenal failed to impose themselves on the match all night, with their best spell coming in a brief part of the first half.
Arteta gave a scathing review of the game, when he said: "We didn’t compete, we never got into the game, we put ourselves in trouble time after time, we lost every duel.
"Every aspect of the game we were second best and Newcastle totally deserved to win the match, probably by a bigger margin as well."
On the fading hopes of reaching the top four
"We need to win and we need a defeat from them," Arteta said.
"We know that in football, that’s always possible, and if anything happens, you have to be there in order to do that.
"Today, you have to put your head down, swallow all the disappointment that we all feel, hopefully, and tomorrow start again."
On lack of January business
After Newcastle spent a record amount of money in January that's played a major part in them turning their fortunes around, the Arsenal boss was quizzed on whether his side should've been more proactive in the winter transfer window to make them more competitive in the second half of the season.
He said: "We have done what we can, and with what we were allowed to do, what we could do and the resources we had from the start of the season.
"The team that we were able to build is what we were able to build and it’s the team that has taken us all the way here."