Varndell crossed for Leicester but is was not enough for victory
Toulouse (14) 22
Tries: Poitrenaud, Clerc
Pens: Elissalde 2
Drops: Courrent, Elissalde
Leicester (8) 11
Pens: Goode 2
Leicester's Heineken Cup hopes are hanging by a thread after they crashed to defeat against Toulouse.
The home side took the lead through a Valentine Courrent drop-goal on three minutes but Leicester replied with a well-worked try from Tom Varndell.
Clement Poitrenaud scored a superb try and Jean-Baptiste Elissalde increased Toulouse's lead with another drop-goal.
Andy Goode kept Leicester in touch with two penalties but Vincent Clerc's powerful try gave Toulouse the win.
Although the Tigers are still mathematically in the competition, their second defeat in pool six - combined with the failure to collect a bonus point in France - mean that Toulouse are now favourites to reach the quarter-finals.
And it was Toulouse's ability to finish off the chances they created which was ultimately the difference on a cold but clear afternoon in France.
The game started cagily and the opening stages were reminiscent of the recent World Cup, with both sides happy to kick away possession.
Heymans produced an impressive display
But a poor kick to touch by Leicester fly-half Andy Goode led to the opening score on two minutes as Toulouse collected the ball and rumbled forward, allowing Valentine Courrent to slot over a drop goal.
The home side dominated territory but after keeping out Toulouse on their own line, the Tigers started to get back into the game.
And after a neat interchange of close-range passing in the forwards got the Tigers deep into the Toulouse half, the ball was spread wide and Varndell was able to sneak in at the corner.
But Toulouse, with Cedric Heymans always looking to come in off his left wing, were always a threat and the French side took the lead again with a superb score on 20 minutes.
Heymans cut a wonderful line as Toulouse attacked and the ball was spread out to the wing at pace for Poitrenaud to touch down.
Leicester could have conceded another try 11 minutes later but England flanker Lewis Moody produced a wonderful tap tackle on Yannick Jauzion when the centre looked certain to score.
Toulouse had to settle for a drop-goal from Elissalde instead but Goode reduced the deficit with a penalty on 34 minutes.
With the first half drawing to a close, Elisalde added another three points only for Goode to reply again after the break when Florian Fritz was penalised for a body check on Ireland full-back Geordan Murphy.
As Toulouse looked to claim the killer score, Leicester wing Seru Rabeni was lucky to get away with dawdling near his own line as he looked to gather a kick-through, the video referee ruling that the Fijian just managed to touch down ahead of the chasing Clerc.
The French crowd were left fuming after the decision and for the next 15 minutes the Toulouse players seemed to lose their way.
But after withstanding some Leicester pressure, the French side regained their composure and Clerc made sure of the win when he stepped in off his wing and managed to bundle over despite Rabeni, Geordan Murphy and Martin Corry all trying to stop him.
Elissalde kicked his second penalty with eight minutes to go and although Leicester tried everything to get back into the game, Toulouse closed out a deserved victory.
Toulouse scrum-half Byron Kelleher:
"We let ourselves down last week and we knew it was payback time.
"I thought we definitely had more power up front and in the back line than Leicester and I'm really happy with our progress this season.
"But it's more important at this stage of the season that we have cohesion in our play and build friendships within the team and squad. And we're doing a great job out there of playing for each other.
"Whether we can win the competition is a long way off because we've got a lot of games to play."
Leicester skipper Martin Corry:
"We knew we had to win today and now we have to wait on other results. Not getting anything from the game is crucial.
"It is now not in our hands. In our two away games we have let ourselves down.
"It is very disappointing but we have character and we have to show that we can bounce back, claim something from the next two games, and then we will have to wait and see."
Toulouse: Poitrenaud; Clerc, Jauzion, Fritz, Heymans; Courrent, Elissalde; Human, Servat, Hasan, Pelous (capt), Albacete, Nyanga, Dusatoir, Sowerby.
Replacements: Lacombe, Perugini, Millo-Chlusky, Lamboley, Kelleher, Kunavore, Medard.
Leicester: G Murphy; Rabeni, Smith, Hipkiss, Varndell; Goode, F Murphy; Ayerza, Chuter, Castrogiovanni, Hamilton, Kay, Corry (capt), Moody, Crane.
Replacements: Kayser, White, Blaze, Abraham, Youngs, Mauger, Vesty.