Liverpool striker Suarez grabbed the second of two opportunistic goals in the 85th minute of a tense Group D battle in Sao Paulo after Wayne Rooney had looked to have rescued a point for England with a 75th-minute equaliser.
The defeat leaves England, beaten 2-1 by Italy in their opening match, needing a miracle if they are to avoid failing to reach the second round of a World Cup for the first time since 1958.
Suarez - named English football's player of the year after a superb season for Liverpool - had been a doubt for the World Cup after undergoing knee surgery in May.
However the 27-year-old returned to haunt an England side containing five of his Liverpool team-mates.
With both teams knowing that a defeat would likely prove fatal to their chances of progressing to the last 16, the game started cautiously.
But England's inability to retain possession always looked likely to gift Uruguay an opening and so it proved.
Loose play from England captain Steven Gerrard saw Uruguay break swiftly, with Nicolas Lodeiro releasing Edinson Cavani down the left.
The Paris Saint-Germain striker delayed his cross to perfection, leaving Suarez, who had ghosted clear of Phil Jagielka, to head back past wrong-footed England goalkeeper Joe Hart.
With England struggling to break Uruguay down for much of the second half, Suarez's opener looked to be enough.
But 15 minutes from time Rooney, having missed a host of chances, tapped in a low Glen Johnson cross. It was his 40th international goal, and first at a World Cup.
The goal gave England hope who tried to press their advantage. Even though England looked the likelier to score, five minutes from time the ball broke off Gerrard for Suarez, who raced clear.
The Liverpool man glanced up and then unleashed a ferocious shot into the roof of the net.
Uruguay's victory leaves England needing Italy to beat both Costa Rica on Friday and the Uruguayans next Tuesday.
England would then need to beat Costa Rica in their final game to have any chance of qualifying on goal difference.
Off the pitch, FIFA confirmed it had opened an investigation into reports Mexico supporters chanted anti-gay slogans during their country's World Cup game against Cameroon.
"We have opened proceedings against Mexico for improper conduct of supporters. As the proceedings are ongoing we are not in a position to comment further," said FIFA spokeswoman Delia Fischer.
FIFA also said it was embarrassed that scores of Chileans managed to gate-crash the Maracana Stadium before their team's match against Spain on Wednesday, vowing to tighten security to avoid a repeat.
A crush of fans, many wearing their country's red jersey, shattered a door to the iconic Rio de Janeiro stadium's media center and swarmed into internal corridors before the match, leading to 87 arrests.
"It is embarrassing," FIFA's security director Ralf Mutschke said of the incident. "I think we have to protect journalists and the media and there's no doubt about it, we also have to protect the fans."
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