The Reds failed to win despite taking the lead midway through the second half through Mohamed Salah as they allowed a late comeback from the Foxes.
Midfielder James Maddison responded with a sublime finish on the 78th minute mark before Jamie Vardy swiftly put the hosts ahead four minutes later.
Harvey Barnes delivered the coup de grace five minutes before the final whistle to put the game beyond the visitors.
Liverpool currently sit fourth and are now 13 points behind Premier League leaders Manchester City, who have a game in hand, and Klopp believes it is impossible to retain the title.
When asked by Sky Sports News if he had conceded the title, Klopp responded: "Yes. I can't believe, but yes.
"I don't think we can close the gap this year, to be honest. We have to win football games, and a large part of our game today was very good.
"What we need to try to avoid are mistakes and misunderstandings. In two situations today we didn't do that and that's how they were allowed to score two goals. Results are massively related to the performance - we were good enough today to win the game apart from a couple of mistakes towards the end.
"Before the game, we all knew that Ozan [Kabak] is a really good player and we know that afterwards as well but he's not used to all the things we do. Ali [Alisson] is offensive and likes to come out of his goal.
"When you are new together this usually happens but it happens in pre-season. Unfortunately, we've not had that. We're not worrying about the title, we're not silly.
"We have a tough game on Tuesday and then the derby next week. That's what we're thinking about."
