The Cypriots frustrated their illustrious rivals for 74 minutes of the first leg of their quarter-final tie with Los Blancos, but then Karim Benzema opened the scoring with a header before adding a second goal late on after Kaka had doubled the visitors' advantage.
Jovanovic had no complaints about the final scoreline and was full of praise for a Madrid team that he believes is bound for Munich.
"The result was fair," the Serbian lamented in his post-game press conference. "We tried to contain them but they upped their tempo towards the end and we couldn't hold on.
Madrid are in the semi-finals; there is no question about that. I even believe that they will reach the final and, hopefully, win it.It was very gratifying to play against a team like Real Madrid. We all saw first hand what a quality side they are.
"You could say this game was a crowning moment for the fantastic campaign we produced this season in the competition.
"My players have done themselves proud throughout this campaign and once again against superior opponents like Madrid."
However, Jovanovic conceded that his players could be in for a very long night at the Santiago Bernabeu next Wednesday.
"The second leg will be harder," he admitted. "We need to try and exit the competition in the best possible fashion.
"Our campaign will forever be written in gold in the history of not just our club but Cypriot football also.
"The Champions League may have taken its toll on us in terms of injuries and fatigue but it has been worthwhile.
"The experiences of being here and playing here was worth it but there are many games left in our own league and we are still in with a chance of reclaiming the title."