The Canaries are still looking anxiously over their shoulders, now just three points clear of the drop zone heading into the final two matches, after Gabriel Agbonlahor's brace, including a last-minute winner, sandwiched Grant Holt's penalty.
While Villa, under former Canaries boss Paul Lambert, will now be hoping they have done enough to avoid a last-day scrap for survival when they travel to Wigan, Norwich must beat West Brom at home next weekend to avoid a nervous final outing at Manchester City.
"We are massively disappointed and frustrated," said Hughton. "It was a game I don't think we deserved to lose.
"We were very good in the first half, but we knew what Villa's strengths were, and the quality they have. We kept them quiet for most of the game, but conceded two poor goals.
"We were a threat in the final third, but you have got to score goals, which has been difficult for us."
Hughton's men have struggled for consistency since their 10-match unbeaten run ended, winning only twice in 2013.
Despite Norwich's poor run of form, Hughton remains optimistic.
"We are in a battle, we know that, but it is still in our hands," he said.
"We have two games left, the next is at home to West Brom, so we need to make sure we dust the players down and make sure we show a lot of the good things which we did do, because we will need every bit of that next week."
- Sports & Recreation
- Gabriel Agbonlahor
- Paul Lambert