Dejan Lovren said Liverpool will improve on a shaky start to the season but admits, "A lot of things are not right at the moment."
The centre-back said he took little satisfaction from the Reds' 3-2 Premier League win at bottom club QPR on Sunday because it was such a poor performance.
Brendan Rodgers' side lie fifth in the league, having won four of their opening eight matches, but they have managed just one clean sheet in all competitions and rarely looked solid defensively.
Lovren, 25, warned that Liverpool must turn in a much better performance when Real Madrid continue their bid to defend their Champions League title in a Group B match at Anfield on Wednesday.
Despite being one of nine players brought into the club over the summer, the former Southampton defender does not see the vast squad turnover as an explanation for the Reds' display at Loftus Road.
"We didn't play with so many new players against QPR, so that's not a reason," Lovren told the Guardian.
Richard Dunne's own goal gave Liverpool a second-half lead at QPR before a crazy finish that brought four goals in the closing few minutes.
Eduardo Vargas equalised in the 87th minute, then did so again in injury time after Philippe Coutinho had restored Liverpool's lead, only for Steven Caulker to score a 94th-minute own goal to hand the points to the visitors.
"I was glad it was over because I think one minute more and it would have been 3-3," said Lovren. "It's the first time in my career I was unhappy after the game even though we won -- because we didn't play well. We need to improve and play more like a team.
"This was not an easy game but one that we should have seen out comfortably, especially after taking the lead. We need to be better and in our next game against Real Madrid we need to show more.
"We will not play like that against Real Madrid, you can be sure of that.
"We will be better. We cannot play like this because we know what we can expect from Real Madrid. Their players, we know who they are and we will prepare a little bit differently."