The Reds lost to the Gunners 3-2 at the Emirates Stadium yesterday. Gabriel Martinelli gave Arsenal the lead directly after kick-off.
Darwin Nunez equalised for Liverpool, but Bukayo Saka found the back of the net for the Gunners just before half-time.
Klopp had the following to say post-game.
"Yeah, not in the title race," he told the club's official website.
"Imagine if I would sit here and think we are nearly there, wait. Look, we saw a lot of things.
"So we have problems in the moment but because the team in form, the leader of the table… even in a really bad situation for us with early changes of stuff, we caused them real problems, so that's the truth as well.
"Of course, in a situation like ours, we play Arsenal, now we play Rangers obviously and then we play Man City, is that the perfect opponent for finding confidence back? Probably not.
"But we will go out there and fight and that's what we have to do and that's what we will do.
"And we are not here for being happy with the situation we are in and stuff like this and thinking about last year and nearly there and nearly there – not at all, nobody of us is like that."
Anfield Watch Verdict
We do agree with Klopp that Liverpool are not in the title race. The Reds are 14 points behind league leaders Arsenal.
It would take a huge effort for Liverpool to close the gap. Klopp just needs to focus on getting his team to finish inside the top four.
Liverpool's next clash is against Rangers at the Ibrox Stadium on Wednesday night (Champions League).