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Her loss ended India's boxing campaign at Paris 2024.
Borgohain prevailed 5-0 in the contest to remain on course for feat which is unprecedented in Indian boxing.
Preeti also secured a quota for the Paris Olympics.
India will take on Pakistan in men's team squash while boxer Lovlina Borgohain will also be in action.
Lovlina Borgohain, Nikhat Zareen, Nitu Ghanghas and Saweety Boora have advanced to the finals.
Olympic bronze medallist Borgohain was out-punched by last edition's silver medallist Rosie Eccles of Wales.
India will take on Barbados in the women's cricket at the Games today.
Lovlina outpunched the New Zealand pugilist Ariana Nicholson, who is 15 years her senior, in the 70kg competition. She will now face Rosie Eccles of Wales in the quarterfinals.
The Indian women's hockey team will take on Wales.
India's Chef de Mission Rajesh Bhandari, who happens to be the vice-president of the Boxing Federation of India, was not pleased with the development.
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