"Overall, I thought it was the best stuff I had all year," Hughes said. "I take that for what it is. Obviously, a loss is a loss and I need to get better, but I feel like if I can take that stuff out, I can win some ballgames. I have to improve on some things, but there were some positives in there."
In a battle of scuffling young pitchers looking for a critical victory, Hughes lost out to Baltimore's Brian Matusz, who earned just his second victory in the last two seasons and his first since June 6 of last year.
The victory was Baltimore's first in five tries against New York this year and put the surprising Orioles -- who lead the Yankees by 1 1/2 games in the American League East -- in position to leave town with a series victory on Wednesday night.
Doing so would cement Baltimore manager Buck Showalter's 1,001st career victory. The former Yankees skipper, who won his first career game at Yankee Stadium, reached the milestone millennium mark with Tuesday's win.
"It started here, and we definitely wanted to get a win while we were here," said Orioles first baseman Chris Davis, who went 3-for-4 with a homer. "They really embarrassed us at our place, and we kind of wanted to take something from them here."
Hughes, who has reached the sixth inning just twice in five starts this year and failed to complete the frame each time, relied heavily on his fastball and curveball on Tuesday night, vowing to go down throwing his top pitches.
Yankees manager Joe Girardi said he saw improvement from the right-hander, particularly in his coverage of the plate.
"I thought he was better," Girardi said. "I thought he had better command of his fastball, I thought his breaking ball was sharper, I thought less balls leaked on him, in the sense of crossing over the plate. I thought he was better."
Two pitches that got away from Hughes ended up in the outfield seats -- a solo homer for Davis in the first and a two-run shot by J.J. Hardy in the third to make it 3-1. Curtis Granderson belted his ninth home run of the year in the first, but the Yankees' offense sputtered the rest of the way.
They stranded nine baserunners on the evening, including three in the seventh, when Alex Rodriguez popped out to the catcher on the first pitch he saw from Baltimore reliever Darren O'Day.
"Beautiful pitch to hit," Rodriguez said. "That's exactly the pitch you want, right down the middle, hanging slider. I should have done a lot better than popping up to the catcher. That's the perfect pitch to hit and hit hard somewhere."
The Orioles scored three runs in the top of the sixth -- two on a fielding error by Eduardo Nunez, who is still learning the ropes in left field -- and one more in the eighth, when Nick Johnson connected on his first hit of the year, snapping an 0-for-29 slump.
Granderson, who has reached base safely via a hit or walk in 22 consecutive games, was 2-for-3 on the night. Derek Jeter was 3-for-5 to bring his season batting average up to .400.
But the heart of New York's order -- Rodriguez, Robinson Cano and Mark Teixeira -- combined to go 2-for-12. Together, the three sluggers are batting .248 (67-for-270) this season.
"There's no question we've each got to get better," Rodriguez said. "There's no question in my mind that all three of us are going to get better."