United's youngsters slipped to a third consecutive league defeat in a row at Wilford Road on Tuesday afternoon.
Diego De Girolamo opened the scoring in the 15th minute and in truth United should have been in command by the time the home side got a foot hold in the game.
DE GIROLAMO confidently slid the ball past the onrushing Forest goalkeeper from 18 yards after running on to a well weighted pass by Dominic Calvert-Lewin.
Otis Khan looked a threat throughout the first-half and after combining with De Girolamo, the midfielder released Robbie Fixter, who should have doubled the lead in the 26th minute.
The visitors were left to rue missed chances just after the half hour when Forest took full advantage of a misunderstanding between Ioan Evans and Joe Cheeseman to restore parity.
The Reds then took the lead in somewhat fortuitous circumstances just before the break. Cheeseman appeared to be fouled when attempting to clear his lines and after a couple of lucky ricochets the ball was forced home past Eastwood from close range.
The second-half was a scrappy affair with neither team getting a grip of the contest. Forest probably edged proceedings, but for United Calvert-Lewin and Khan offered hope of an equaliser.
Fahad Ishmail left the field of play due to an untimely injury, meaning the Blades had to play the last 15 minutes with ten men, as the game fizzled out.
Coach Travis Binnion remarked: "We started the game really well and were good value for our lead, but we should have certainly built on that advantage and won the game.
"An individual error, a poor decision and a lack of cutting edge in the final third proved to be our undoing."
Blades: Eastwood, Ishmail, Kedman, Partodikromo, Evans, Cheeseman (Mbuti 45), Wright (Blackett 59), Calvert-Lewin, Fixter, De Girolamo (Scarth 59), Khan. Unused: Owen, Coustrain.