The Blues ended up empty-handed after Frederic Michalak guided the three-time champions home with an 18-point tally.
Faao Filise touched down to bring the Blues back into contention but ill-discipline cost the visitors dear as Michalak booted home five penalties at le Stadium.
The result leaves Young’s men five points adrift of the French giants in Pool Five and Young said: “We are up against it but we are not dead and buried. We probably have to rely on others to do us favours.
“There are two games left and we want to win those two games. It probably won’t be enough but we can still go through to the challenge.
“We are a proud group. We have played one of the biggest teams in Europe back to back and we have stood up well.
“I am not happy with the loss and we are not going to pat ourselves on the back. But we have tested ourselves against the best.
“It has to be bonus points all the way for us and if we could have got one yesterday we could have been in within a shout.
“All we can do is dust ourselves off and make sure we get maximum points.It is not going to be easy because Sale and Harlequins are two very good sides.
“We are not underestimating that. We will try and win the game first but if we are to progress we need to make sure we get maximum points.”
The Blues suffered a 41-17 hammering at the same venue in the quarter-final in 2008. But, despite the blow of losing in the south of France, Young believes his side have come a long way.
Young added: “When we did get some field position we did trouble them and that was a pleasing thing.
“The penalty count made sure they could edge in front but we were in that match for big parts and it was a far cry from out here two seasons ago when it was men against boys.
“We were in there kicking but it was not quite good enough.”
Toulouse skipper Thierry Dusautoir admitted he was content after the convincing win.
Dusautoir said: “We are satisifed with the result and it was important to win. We were disappointed with the defeat in Cardiff last weekend but we are very happy today.”
