Oscar Tabarez's side slumped to an embarrassing defeat, losing their first game ever in their Olympic history in the process, bringing an end to an 88-year unbeaten run
Both sides went into the game off the back of decent results in the opening group games, but it was Senegal which took the initiative in the 9th minute, with Moussa Konate tapping home a rebound from a corner.
They had a man sent off just after the half-hour mark, though, when Abdoulaye Ba barged over Luis Suarez and was found to be preventing a clear goalscoring opportunity. Nevertheless, Konate struck again in the 37th minute, nodding home unmarked to expose this Uruguay defence's vulnerability from set-pieces and despite Uruguay wasting a few gilt-edged chances, they were good value for their win.
Senegal made two changes to the side that managed to snatch a late draw against Team GB in their group opener, with Stephane Badji and Cheikhou Kouyate coming in for Ibrahima Balde and Idrissa Gueye.
Uruguay coach, Oscar Tabarez, made just the one change to his starting eleven, bringing in Nicolas Lodeiro, who struck the match-winner in their 2-1 victory over the United Arab Emirates, in place of Matias Aguirregaray.
Uruguay began the brighter of the two sides, with Gaston Ramirez striking a free-kick from distance narrowly over in the second minute, but Senegal responded well with a decent spell of possession, gradually pushing their way up the pitch.
They went on to take the lead in the 9th minute through Konate, after he poked home from barely a yard out after Uruguay goalkeeper Martin Campana could only parry Kouyate's diving header at the back post from a Pape Souare corner.
But they didn't rest on their laurels, though, with Mane beating Ramon Arias for pace down the right-hand side before cutting back an excellent ball for the unmarked Konate, who brought out a top save from Campana at his near post, after he tipped the ball acrobatically behind for a corner.
With Uruguay struggling to retain possession and create anything further forward, their best chance of the half came in the 27th minute when Ramirez struck an absolutely superb free-kick from 30 yards out which struck the inside of the post before being hacked clear, with Mane rooted to the spot and well beaten.
The game was turned on its head moments later, when the already booked Ba was given a straight red card for a hugely cynical challenge after he barged over Luis Suarez after a fine break away from a free-kick up the other end of the pitch. Maximiliano Calzado volleyed well over after a goalmouth scramble from the resulting free-kick.
This brought the game to life and with an extra man advantage, perennial slow-starters Uruguay began to carve open Senegal at will, with Saliou Ciss clearing a toe-poked Arias effort at the back post off the line with the increasingly erratic Mane nowhere to be seen yet again.
Despite only having ten men, though, Senegal extended their lead in the 37th minute with Konate nodding in his second of the match and third of the tournament with the Uruguay defence tragically static, with Souare again credited with the assist, picking out the only green shirt in the entire six-yard box.
As it neared half-time, the end-to-end action showed no signs of relenting, after Ramirez forced a decent stop from Mane, connecting well with Suarez's squared free-kick, not before Konate nearly added a third after a break straight up the other end, dragging his effort wide after being put under pressure from Arias.
With the half ending at a frantic pace, Cavani beat the offside trap in added time, picking up a sumptuously threaded through ball from Lodeiro, rounding the onrushing Mane, but not before Ciss got back in time and cleared his effort off the line as Senegal went in at the break two goals to the good but a man down.
La Celeste started the brighter of the two again in the second half, with Ramirez again threatening from range with a free-kick shortly after the restart. The Bologna man then set up an excellent chance for substitute Abel Hernandez, dinking a delightful ball over the back four, before the youngster saw his effort well blocked.
With Senegal struggling to get out of their half, Uruguay broke at pace, with Hernandez playing in Cavani, but the Napoli forward's poor form throughout the tournament continued as he pulled his effort miles wide, with Suarez well placed further inside and begging for the ball to be played in to him.
On the hour mark, Liverpool striker Suarez, who was enduring a bad afternoon at the office, nodded narrowly wide with the goal gaping after pealing off his marker at the back post, from a Lodeiro ball in, with Mane again in no man's land.
With chances few and far between after that, though, the game petered out into a scrappy affair, with both sides seemingly incapable of stringing more than two passes together, with only a lacklustre Suarez going close in the final stages after latching onto a Coates flick-on.
It brought an end to a deeply frustrating evening for the Uruguay side, as they failed to make the most of their numerical advantage and the chances that they did manage to create. Meanwhile, Senegal's physical approach appears to be paying dividends as they emerged deserved victors in a keenly-fought contest.