A goal from Marvin Emnes, who turned down a loan move to the Iron, secured a famous 1-0 win for Swansea.
"We have allowed the gap at the top to close. That is all. We needed height down the middle and I had to make decisions but now we will have to lick our wounds and get on with it," he said.
"We had a couple of good chances but it was a fine line and that is how derby games are. We were a little below par and one bad defending decision and lack of concentration has cost us, but there was never much in the game."
Swansea are right in the mix for the automatic promotion places, but their boss Brendan Rodgers also sought to temper supporters' expectations.
"Our starting XI is as strong as the top two teams in this division but you won't hear any talk from us about promotion," he said.
"We have shown great consistency and as long as we keep on progressing then I will be satisfied."
Nigel Clough, the Derby County manager, played down hopes of a promotion challenge despite his side moving to fourth in the table with a 2-0 win over Portsmouth.
"We have played 15 games and we are third of the season in so there's a long way to go," he said.
"We weren't talking about relegation when we were third from bottom six weeks ago so we are certainly not going to talk about promotion when we are fourth from top."
The Nottingham Forest boss Billy Davies said his side are not good enough to win promotion. His side drew 1-1 at Watford on Saturday, and are level with the Iron on 20 points.
"Because of the lack of expansion when we were on a high point and finished third then what you see is what you get with this team," he said.
"They'll win, they'll lose and they'll draw and they are what they are. We are not a top six side and anybody who thinks we are is like comparing that to Britain ruling the world as far as I'm concerned."