Emmanuel Toku scored twice for the Black Satellites but goals from Effiom Maxwell Michael (2x), Abubakar Ibrahim and Wasiu Alalade ensured a win for the Flying Eagles at Stade Municipal de Lome.
The result, coupled with Friday's 1-0 loss to Niger in their tournament opener, has left Ghana bottom of Group B, which has been reduced to three teams following the withdrawal of Benin.
Nigeria and Niger, thus, are through to the next round as group winners and runners-up, setting up semi-final dates with Mali and Senegal respectively.
Toku opened the scoring for Ghana in the 28th minute, before Michael restored parity for Nigeria two minutes to half-time.
In the 77th minute, the Flying Eagles went 2-1 up from a penalty which was coolly tucked into the net by Ibrahim.
Alalade then netted in the 81st minute to make it 3-1 to Nigeria before Toku and Michael registered their second goals of the game.
The Wafu Cup is part of Ghana's preparations for the 2019 Africa U-20 Cup of Nations slated for Niger between February 2 and 17.
The top four sides at the continental showpiece will earn qualification tickets for the world gathering in Poland in May/June.