J-League sides Kawasaki Frontale and Nagoya Grampus, together with FC Seoul and Pohang Steelers from the K-League, join West Asia zone teams Al Ittihad of Saudi Arabia, Umm-Salal of Qatar and Pakhtakor and Bunyodkor of Uzbekistan in September's quarter-finals.
The Osaka outfit twice went ahead twice through Brazilian striker Leandro only to lose 3-2 to Kawasaki Frontale, with goals from Japan international Kengo Nakamura, Brazilian Renatinho and Masaru Kurotsu securing a come-from-behind victory.
"I was very disappointed," said coach Akira Nishino. "Key players came back from injuries and we played better than I had expected. But we lost goals when my players slowed down in the second half."
"But it was our best eleven. I was really disappointed, because we cannot play in the Champions League any more even though we are regaining our best form," he added.
"It was really a tough game, but we ended with a win. It gives us a lot of confidence to reach the last eight in Asia," said Nagoya's Serbian coach Dragan Stojkovic.
In an exciting game at the Kashima stadium, Seoul beat J-League champions Kashima Antlers 5-4 in a penalty shootout after drawing 2-2 after extra time.
Forward Shinzo Koroki had opened the scoring in the fifth minute for the home side when defender Park Yong-Ho's clearance rebounded kindly for Koroki to fire into the net.
But Seoul levelled in the 22nd minute when home defenders Atsuto Uchida and Daiki Iwamasa failed to clear a cross from the right, which allowed the Korean side to snaffle an equaliser.
One minute later, Seoul had a great chance to go ahead, but Montenegrin striker Dejan Damjanovic's shot came back off the right-hand post and Masahiko Inoha cleared the rebound.
Kashima got off to a flying start in the second half, with Iwamasa's header from a Mitsuo Ogasawara corner saved by goalkeeper Kim Ho-Jun. But Takeshi Aoki made no mistake from the next corner kick, nodding home in the 50th minute to make it 2-1.
Kashima then suffered a major setback when skipper Mitsuo Ogasawara received a second yellow card, which enabled visiting midfielder Ki Sung-Yueng to fire a free-kick equaliser on 78 minutes.
"It was an exciting game between the top teams from the K-League and the J-League. I said before that the winners of this game will reach the final. I still think so," said Seoul's Turkish coach Senol Gunes.
"In the second half Kashima went a player down, but they played excellently. I'm really happy that we won today. Hopefully, we can keep winning the up-coming games as well," he added.
Kashima's Brazilian coach Oswaldo Oliveira said: "Unfortunately, we lost a penalty shootout, but my players performed very well for 120 minutes. Even after we were reduced to ten men, we created many chances."
"Sometimes you win and sometimes you lose. We just ended with a defeat today. Hopefully we can win the J-League and come back to the Champions League next year again."
In South Korea, midfielder Choi Hyo-Jin scored a hat-trick to lead Pohang to a 6-0 thrashing of Australia's Newcastle Jets, with Brazilian Denilson tormented the visitors, scoring one and setting up two more.