British light-heavyweight Joshua Buatsi secured a victory yet disappointing start to his career under fresh promotional backing with a points victory over Parker in the Manchester arena.
The Olympic bronze medallist's work rate likely gained him a judges' verdict in a competitive 10-round fight at the Manchester venue.
But Parker landed significant shots, connecting with powerful clean blows in a match where the styles didn't complement each other, with constant grabbing spoiling the contest.
Two judges scored it 96-94 for to Buatsi, with the final judge a 95-95 draw.
"It wasn't my best display but how do champions respond? They win," the victor said in the ringside as he was faced disapproval from the audience.
The British fighter got back to winning after his initial pro loss - an epic battle with Callum Smith in last winter - to secure a 20th pro success.
Several boxing experts thought Parker, 31, merited the win but the contender suffered the second loss of his 28-bout professional journey.
Buatsi Claims Triumph in Uneventful Match
Buatsi's progress has plateaued in the past few years through contract problems and considerable time of inactivity.
Previously predicted as the next star of British boxing, he now is positioned trying to fulfil that early promise - possibly in what feels like a ultimate opportunity - under fresh management.
He opened tentatively, with neither fighter prepared to be aggressive in a tentative early stages.
The challenger, whose single earlier setback came at super-middleweight against John Ryder in 2022 after damaging his hand during the bout, was competing in only his second fight at light-heavyweight.
By the halfway stage, Parker had stayed in contention, creating difficulties for Buatsi, who worked behind a protective stance to narrowly win the cleaner rounds.
The crowd's patience wore thin during constant clinching, with Parker going down various instances during clinches.
Parker ended stronger, but several stanzas were difficult to score. Nevertheless, previous titleholder the boxing analyst - commentating on the broadcast network - had it significantly in favor for the challenger, scoring for Buatsi just one round.
Buatsi progresses, but with the caliber of power puncher Benavidez, and Russian champion Dmitry Bivol dominating the weight class, the road to world glory - judging by this showing - still seems difficult.
Hatton Homage Inspires All-Manchester Battle
In the secondary fight, Arthur overcame Bradley Rea by split-decision in a excellent local rivalry contest to secure the European light heavyweight championship.
The stadium grew hushed for a profoundly moving tribute ahead of the contest as a bell ceremony rang in honor of the city's native Hatton, who passed away aged 46 in September.
It was the first major televised boxing event in the city since the passing of Hatton. As the final chime faded, the quiet gave way to a shout of "only one Hatton".
The action during the bout equaled the emotion. The eventual winner was knocked down by a left hook directly to the chin in the early round, getting up unsteadily to his position on the referee's count.
But the traditional red equipment of Arthur soon pressed ahead again. On the opposite side, the opponent - in rival City blue - was injured early, significant bruising developing under his face as the pair exchanged punishing blows.
Rea, 27, landed power punches but the champion, thirty-four, matched the intensity with stinging uppercuts as the intensity rarely dropped over 12 rounds.
Arthur narrowly won the verdict with official scores of draw, narrow lead and wider gap, but the two athletes were persistent and full of heart, all the qualities their idol Hatton represented.
