The Gunners failed to capitalise on losses for top-four challengers Tottenham Hotspur and Manchester United at the Emirates Stadium, as they were turned over by their London rivals. Mustafi was caught sleeping for Wilfried Zaha's goal, as Palace went 2-1 ahead.
It was a bad moment from a player who is developing a reputation for lapses in concentration at crucial points. Afterwards, Emery said he felt as though Mustafi has set a decent standard this term, per Sky Sports:
"He can play very well. I prefer to speak about the consistency in the season. We are helping every player to play with a big performance. Today also when you can defend against [Christian] Benteke and Zaha you can suffer more.
"Over the season I think he has been consistent."
The defeat for Arsenal sees them remain in fourth spot, as they are level on points with Chelsea but ahead on goal difference. The Blues can go into the top four on Monday if they beat Burnley at Stamford Bridge.
Overall, it was a testing weekend for a number of sides seeking to get into the UEFA Champions League next season:
Mustafi's mistake was costly for Arsenal, as Mesut Ozil's goal after half-time cancelled out Christian Benteke's opener, giving momentum back to the home side. Zaha's goal gave Palace a huge boost, before James McArthur made the game safe eight minutes later.
James Benge of Football.London rated the Arsenal players after the match and had nothing positive to say about the performance of the Germany international:
Arsenal writer Tim Stillman was critical of the attitude showcased by the defender in difficult situations:
Although Emery is seeking to defend his player at a key point in the season, the form of the centre-back will be a concern to him.
There are times in games when Mustafi looks aggressive and assertive, although far too often he loses concentration and makes bad decisions. Sunday's incident is quickly becoming the norm.
If Arsenal are to progress, it feels vital they upgrade their options at the back. Football writer James McNicholas wants to see the former Valencia man moved on:
There was excitement when Mustafi arrived at the Emirates. Having excelled in Spain, it appeared the Gunners had finally secured the commanding centre-back they'd been lacking for many years.
However, the German failed to adapt to English football and this season his form has deteriorated amid a vital run of matches for Arsenal. If a decent offer was to be lodged, surely the 2018-19 campaign would be Mustafi's last at the Emirates Stadium.