IOWA CITY, Iowa -- Penn State now must tackle its toughest assignment.

The Nittany Lions have to try to salvage their season after having their national championship hopes shattered Saturday in a 24-23 loss at Iowa.

"For the seniors, it's like a huge bomb exploded," wide receiver Deon Butler said. "It was so close to being a perfect season."

Not only is Penn State's unbeaten season gone, so is its lofty ranking in the national polls and Bowl Championship Series standings, and its first-place stranglehold atop the Big Ten Conference.

Penn State (9-1, 5-1) dropped five spots in the BCS yesterday, falling from No. 3 to No. 8; four places in The Associated Press poll (No. 3 to No. 7); six spots in the USA Today coaches' poll (No. 2 to No. 8).

And the Lions trail Big Ten leader Michigan State (9-2, 6-1) by a half a game.

Despite Penn State's loss to Iowa when it blew a nine-point, fourth-quarter lead and fell on Daniel Murray's 31-yard field goal with one second left, the team controls its own destiny.

The Lions also have their eyes on a decent consolation prize.

They can capture at least a share of the Big Ten championship and the BCS berth in the Rose Bowl by beating Indiana (3-7, 1-5) and No. 18 Michigan State the next two weeks at Beaver Stadium.

No. 10 Ohio State (8-2, 5-1), which lost to Penn State, 13-6, also is tied for second in the conference.

"I'm hoping we can win a Big Ten championship and go to the Rose Bowl," wide receiver Derrick Williams said. "We didn't play our best football [against Iowa]. We have to focus on the next game and make sure that [loss] doesn't turn into two."

The Spartans are off Saturday, so if the Lions polish off the Hoosiers, the Nov. 22 game at Penn State will serve as the unofficial Big Ten championship game, with the winner going to the Rose Bowl.

In a three-way tie between Penn State, Ohio State and Michigan State, the Spartans would win the tiebreaker because it was the only one of the three not to play a Division I-AA team.

If the Spartans beat the Lions and the Buckeyes win out -- they have games left at Illinois and home with rival Michigan -- and both finish with one loss, Ohio State would go to the Rose Bowl by virtue of beating Michigan State, 45-7.

"There's still a lot to play for," Penn State quarterback Daryll Clark said.

In 1999, Penn State was 9-0 and ranked No. 2 in the country before losing to Minnesota, 24-23, on Dan Nystrom's 32-yard field goal with two seconds remaining.

The Lions also lost to Michigan and Michigan State before rebounding to beat Texas A&M in the Alamo Bowl to finish 10-3 and No. 11 in the polls.

In 2005, No. 8 Penn State suffered a 27-25 last-second loss at Michigan, but followed that with five consecutive wins and an Orange Bowl victory against Florida State to clinch an 11-1 season and No. 3 ranking.

"You can't let '99 happen," said senior center and co-captain A.Q. Shipley. "You can't just fall apart."

"You either keep fighting or go in the tank," Clark said. "With all the leadership that we have on this team, I know for a fact that's not going to happen."

NOTES -- Butler had three catches against Iowa to tie Bobby Engram as the school's all-time leader in receptions with 167. ... Tailback Evan Royster had a career high in carries with 26. His 90 yards rushing pushed his season total to 1,060. ... Williams accumulated 154 all-purpose yards, the second-highest total of his career, and scored on a 9-yard run from the shotgun formation. He also completed his first career pass, hitting tight end Mickey Shuler for a 23-yard gain in the fourth quarter.