Kom, who won a bronze medal at the London 2012 Olympics, lost 0-2 to Germany’s Azize Nimani in the second round of the tournament in the 51kg weight category in Kazakhstan.
She needed to reach the semi-finals of the championship to qualify for her second successive appearance in Olympics.
Kom took off aggressively against her German opponent, who kept her at bay by fighting from a distance, according to the Press Trust of India.
The Indian boxer continued to throw herself at Nimani who adopted defensive tactics to frustrate Kom, the news agency said, with the German declared the winner.
“I am extremely happy after today’s bout,” said Nimani.
“Mary Kom is a very strong boxer and a legend in our sport but I was concentrated and focused until the last seconds to accomplish my goal. I knew I could win if I followed my instructions and found my rhythm. Now I want to be world champion.”
Kom secured a spot at the 2012 London Olympics at the same tournament before winning a bronze medal for her country at the Games that year.
Nimani will now meet top seed Marzia Davide of Italy, who beat Hungary’s Katalin Ancsin in their second round fight.
In March Kom lost to China’s Ren Cancan in a key match which could have helped her secure a berth in the Olympics.
The 33-year-old, a star in India, was the subject of a 2014 Bollywood biopic and won gold in that year’s Asian Games in South Korea.
She is also a brand ambassador for AIBA.