Pinot made a strong attack on the Civiglio climb and was joined by Nibali before the summit, but he lost any chance of victory when the Sicilian distanced him on the tricky descent and soloed to take the win in Como.
Pinot finished fifth and his only reward was a visit to anti-doping, while Nibali celebrated on the nearby podium.
"I think I had a super race, I'm just sorry not to win," he said.
"I came here to win. I was riding to win and wanted to win. I took some risk on the last climb because nobody was really moving."
Pinot punched it on the Civiglio and quickly opened up a sizeable gap. The move sparked a reaction first from Domenico Pozzovivo (AG2R La Mondiale), but Nibali blew past his compatriot and rapidly bridged to Pinot and continued pushing the pace over the top and on the sinuous descent.
Pinot, who once was nearly paralyzed with fear on descents and overcame his issues with off-season speed lessons, bravely held Nibali's wheel for much of the drop down to Como, but a small mistake in one turn he opened up a gap that he could never close.
"You can't do much against Nibali when he is so strong. He did an amazing descent. I tried to go with him but it's difficult. He got away a little bit and then it was impossible to pull back 50 metres. He went away from me."
Pinot gave everything in pursuit of Nibali and held off the chasers to the summit of the final San Fermo della Battaglia climb with 5km to go. However, that meant he had little left when Julian Alaphilippe (Quick-Step Floors) caught and passed him on the descent, and less for the sprint for third place.
Pinot has won four minor races this year but ends his season with third at Tirreno-Adriatico, fourth at the Giro d'Italia, and fifth at Il Lombardia but no regrets.
"I think my season, was good, very good. Maybe not the Tour de France but I was there in all my objectives such as the Giro. I've been strong, perhaps missing a little bit but I was at my usual level. I'm satisfied," he said, before heading to the FDJ team bus to eat a slice of pizza with his teammates and end his season.