In Cardiff, a late leveller from Bosnia and Herzegovina's 40-year-old Edin Dzeko cancelled out Daniel James' excellent opener for Craig Bellamy's side, and a goalless extra-time period saw the match go to penalties.
The signs of a Welsh victory looked strong after Ermedin Demirovic missed his side's opener from the spot, but missed penalties from Brennan Johnson and Neco Williams resulted in a 4-2 shootout defeat.
Read more: Wales blow World Cup hopes with shootout defeat to Bosnia and Herzegovina
Meanwhile, Newcastle's Sandro Tonali played a starring role to help Italy move one step closer to their first FIFA World Cup (WC) since 2014, as the midfielder grabbed a goal and an assist to overcome Northern Ireland 2-0 in their play-off semi-final.
The result extended the visitors' wait for a first World Cup appearance since 1986 by at least another four years.
Read more: Northern Ireland's World Cup dream over as Italy book play-off final berth
The Azzurri had failed at the play-off stage in the past two WC qualifying campaigns, but their supporters didn’t appear fazed by past traumas as they created a crackling atmosphere in the build-up to kick-off in Bergamo.
Second-half goals from Tonali and Moise Kean were enough to set up a decider against Bosnia and Herzegovina on March 31st.
Ireland found themselves 2-0 up inside 25 minutes against the Czech Republic, first after a Troy Parrott penalty and then a Matej Kovar.
Read more: Czech Republic beat Ireland on penalties to set up Denmark play-off final
But goals from Patrik Schick and Ladislav Krejci restored parity, and with no goals in extra time, the Czechs would go on to win 4-2 after penalties to set up a final qualifier with Denmark.