The Frenchman was stunned at the Paris Grand Slam by Japanese Kageura Kokoro on Sunday (9 February).
The 24-year-old, a gold medallist in the Mixed Team event at the last World Championships, gave Riner problems in their first meeting in Brasilia last year.
Riner eventually prevailed almost six minutes into golden score on that occasion, and normal time was not enough to separate the pair again in the French capital.
This time, it was Kageura who took the win after 40 seconds of golden score with an uchi-mata-sukashi on the counter for the decisive waza-ari.
Riner's previous defeat was back in September 2010 in the openweight final of the Tokyo World Championships to Takahashi Kazuhiko.
In a video posted to his Twitter account, Riner said, "Today is a day without a medal. It's true that it's weird but it's part of the game. That's sport, there are victories and defeats.
"So we go back to work, find out why it went wrong and, above all, continue to stay focused on Tokyo.
"It's very good that it happened here. It will allow me to understand why. What matters to me are the Tokyo Olympics." - Teddy Riner on Twitter
Kageura scores historic win over Riner
Riner competed just twice last year, winning the Montreal Grand Prix in July before taking October's Brasilia Grand Slam.
This was his first appearance of 2020, and he looked a little rusty in his opener against Hungary's Richard Sipocz who was disqualified for collecting his third shido penalty two minutes into golden score.
The 30-year-old was taken to extra time in the second round too, but defeated Austrian judoka Stephan Hegyi by ippon to progress.
Then came his second meeting with Kageura who had won bronze medals at the Osaka Grand Slam and Qingdao Masters late in 2019.
With the Paris crowd chanting, "Teddy, Teddy", Kageura evaded an attempted leg-throw inside the first 30 seconds.
While Riner was on the front foot for the majority of the contest, his younger adversary looked far from intimidated by Riner's greater height and bulk and even managed to mount an attack near the end of normal time.
There was still no score as the pair went into golden score, but then Kageura saw his opportunity.
The crowd started to cheer as Riner tried a leg-sweep, but Kageura made him miss and countered with an arm throw to leave the French hero crestfallen on the mat.
The cheers turned to gasps, and eventually applause as the referee pointed to Riner's opponent for the first time in a decade.
Kageura then defeated Russia's Inal Tasoev and Brazil's two-time Olympic bronze medallist Rafael Silva to reach the final.
But he had to settle for silver, losing out on ippon to 2008 and 2012 Olympic -100kg bronze medallist Henk Grol of the Netherlands.
The end of one of sport's great win streaks
Riner has been the dominant heavyweight of recent times, but his unbeaten record is not the longest in judo history.
The Pole racked up 312 consecutive wins between February 1994 and March 1998, but could not maintain his dominance when the weight class changed to -100kg.
Karelin left his shoes on the mat immediately afterwards, signifying his retirement from the sport.