A goal from Barcelona forward Pedro was the difference between the two national sides that will compete at this summer's World Cup in Brazil.
"The good news is that in order for Spain to beat us, they have to work very hard," Buffon said to Italian TV station Rai Sport. "We fear and respect each other.There is a great balance between the two sides, even if Spain still have the edge."
Spain dominated the encounter at the Vicente Calderon for long stretches.
"Spain have many players with precise technique," Buffon said. " "Every touch, pass and run is perfect. Hence, you have to spend more energy than they do to keep up with them and limit their actions.
"Unfortunately, when we do have the chance to hurt them and push forward, we lack the sharpness necessary to make those opportunities count."
Buffon was impressed by the performance of Parma central defender Gabriel Paletta. The Argentinian-born player made his debut against Spain and put in a solid performance.
"It's the first time I've played with him," the Juventus goalkeeper said. "I have to say that he played an extraordinary game. After that performance, a lot of people have understood why he has been on the national team radar for a while.
"Paletta has really surprised me because, considering the adversity, he has played a fantastic game."
Italy play their last warm-up game against Luxembourg on 4 June before starting their World Cup adventure against England in Manaus on 14 June.